14 April 2000

Cash-injection vital to Czech tractor companys future

By Stephen Howe

CZECH tractor maker Zetor has been forced to stop manufacturing while it awaits a re-financing package. The marque is particularly popular with many European livestock farmers and once had a 100% share of its home market.

Falling farm profitability and tractor sales at home, fierce competition among the major multi-national brands and underfunding in new technology are blamed for the companys plight, according to industry sources.

Zetor, which has one factory in the Czech Republic and another in neighbouring Slovenia, had capacity to produce more than 15,000 units a year. About 97% were exported by Motokov International, which has a major shareholding in the tractor plant and which also imports and distributes Case tractors in the Czech Republic.

Zetor managing director Zetor Vratislav Goj is hopeful that production will re-start within the next two months following a cash injection of about £11m from the Consolidation Bank authorised by the Czech government.

"That could help Zetor satisfy the demand for existing tractor orders of 5000-6000 units by the end of the year," said Mr Goj. The company also has plans to produce 3m spare parts and 300 engines.

Meanwhile, Zetor is looking for a strategic partner for long-term reinvestment in its tractor plants. Speculation at the Brno Fair, the Czech Republics showcase for farm machinery, centred on a Turkish tractor maker. Rumours that Case New Holland might be interested were hotly denied by Motokovs Jiri Dvorak.

Supplies of Zetor tractors in the UK have been limited for some months, reports Andrew Martin general manager of Motokovs UK agricultural division. And, in the short-term, he expects things to get worse.

"We are sitting on a fistful of orders which we dont expect to fulfil until the summer at the earliest. It all depends on the Czech governments cash injection which will, hopefully, allow small-scale production to re-commence." &#42

What future for Zetor – the company awaits a

re-financing package.