Mobility

Thanks to its more than one-hundred-year history of precision engineering and its exceptional location, good infrastructure and highly skilled workforce, the Czech Republic plays a significant role in the automotive industry and related sectors. The country is home to three key automobile manufacturers, namely Škoda Auto, Toyota Motor Manufacturing Czech Republic and Hyundai Motor Manufacturing Czech. The Czech Republic also offers outstanding business opportunities for suppliers and is prepared to strengthen its position as one of the leading European centres for design and research and development in the mobility sector.

The first half of 2024 marked a historic achievement for the Czech automotive sector, with a total production of 774,310 passenger vehicles—a 4.9% increase compared to the same period in the previous year. This growth underscores the industry's robust recovery and capacity to meet rising demand. By October 2024, the automotive market continued its upward trajectory, recording 19,789 vehicle sales in that month alone, an 8.21% increase from the previous year. Year-to-date sales reached 180,569 units, reflecting a 2.02% growth. Notably, Volvo climbed seven positions into the top 10 brands, achieving a remarkable 77.02% increase in sales.

Despite these positive trends, the industry faces challenges due to stringent European Union CO2 emission regulations set to take effect in 2025. The new rules lower the cap on average emissions from new vehicles to 94 grams per kilometer from the current 116 grams per kilometer. Non-compliance could result in fines of €95 per excess gram of CO2 per vehicle sold. In response, the Czech Republic has sought alliances within the EU to contest these regulations, expressing concerns over potential impacts on competitiveness and the risk of factory closures and job losses. In November 2024, the Czech Republic joined Italy in opposing these stringent emission targets, citing declining demand for electric vehicles in Europe and the financial strain on car manufacturers. Both countries plan to present their joint stance at an upcoming EU leaders' meeting in Budapest.

The Czech automotive industry continues to attract significant investments aimed at bolstering its technological capabilities. In July 2024, U.S. chipmaker onsemi announced a $2 billion investment to enhance its production facility in Rožnov pod Radhoštěm. This expansion is expected to support the global and European supply chain, focusing on intelligent power semiconductors crucial for electric vehicles, renewable energy, and AI data centers.

The Czech Republic also includes other important mobility sub-sectors such as the production of railway equipment (ŠKODA Transportation), trucks (Tatra) and buses (SOR, IVECO), as well as agricultural equipment (Zetor) and aviation technology (Aero Vodochody, Aircraft Industries, Primoco), which is also undergoing major development due to war in Ukraine.

However, other solutions are also being developed, e.g. for autonomous driving (Bring Auto, Vanilla robotics) and solutions for urban mobility, such as Road Twin and Citya.

The Czech Republic is a competitive location for establishing research and development centres. Its technical universities and research centres routinely collaborate with global manufacturers and provide services in the area of research, development and testing.