The Romanian production of domestic appliances continues to grow

MachinesIndustrySouth-East European INDUSTRIAL Мarket - issue 1/2017

The Romanian production of domestic appliances continues to grow

A future new Arctic appliance plant in Romania is on the way
In the end of 2016 it was reported that the establishment Arcelik has received approval to build a new appliance plant in Romania. Arcelik, along with its subsidiary Arctic, of which it owns 96,7 percent, will establish a new plant in Romania to produce washing machines and dishwashers.

The Turkish company investment into the plant will be around EUR 105 million. The Romanian government will invest as aid more than EUR 36 million. It is expected that the project will fully completed in September 2019.

Arctic Cooling Appliances Plant is located in Gaesti, Romania. Arctic is one of the strongest and most powerful companies in Romania, one of the leader of the local market of home appliances, with a market share of over 35%. Arctic is the largest local producer of home appliances, producing over 25 million refrigerators.

With an impressive history, Arctic is one of the oldest companies in Romania. In 2015 it marked 45 years of activity, the team consists of 3,000 employees. Privatized in 1997 when the company was listed on the Bucharest Stock Exchange and later acquired by Arcelik Group in 2002 - these two important moments marked the start of dynamic company development stages.

During 2002-2015, the company went through strong transformations, becoming a solid and important investor, and the turnover tripled from EUR 94 million to EUR 300 million.

In 2013 Arctic established a new production line in its factory in Gaesti, investing EUR 21,9 million. The factory Arctic has become the largest production unit of refrigerators in Europe. 85% of the refrigerators production is exported to over 60 countries in Europe, Africa and Asia.

In Romania Arctic holds three strong brands - Arctic, Beko and Grundig, offering high quality products at international standards, addressing different consumer segments. In addition, Arctic owns the largest service network with nationwide coverage.

Production of domestic appliances in Romania
Due to the fact that the economic climate in Romania is improving, in recent years there is further growth for consumer appliances production and sales. Production of appliances in Romania almost doubled from 2008-2009 up to now because of the good market conditions, new investments and development of the old existing factories.

In terms of industrial production, Romania is considered a European hub because of its geographical position, still much lower labour cost (compared to Western Europe), and well-educated and prepared staff. Big international and local brands are traditionally operating in the country - including Arctic, Electrolux, Philips, De’Longhi and Electroarges.

Based on data of one of the leading statistics companies on the internet - Statista (with 250 professionals working for the portal and more than 1 million registered users), the annual production value of the manufacture of domestic appliances in Romania in 2014 is reaching approximately EUR 721,4 million. Concerning the number of enterprises in the manufacture of domestic appliances industry in Romania, the statistics company is pointing that in 2014, there were 60 enterprises manufacturing domestic appliances in Romania.

One of the Statista forecasts until 2020 says that by 2016, revenues of electric household appliance manufacture in Romania are projected to reach approximately USD 797,52 million.

The growing internal market
The improvement of the local economic status and the buying power of the Romanians reflected in the positive trends in the market of modern and high performance both large and small consumer appliances. The locally produced appliances are traditionally trusted but the international brands benefit from higher consumer loyalty. Very big market share and results have brands as Philips, Bosch, De’Longhi, Electrolux, etc.

Arctic is the most successful domestic brand. It is widely known, respected and distributed through all key retail channels. The major part of Arctic consumer appliances manufactured in Romania are exported.