Czech Car Manufacturer Suspends Production For Three Weeks

By Peter Sedik
Peter Sedik
Peter Sedik
December 23, 2008 Updated: October 1, 2015

The logo of Czech car maker, Skoda. (Jacques Demarthon/AFP/Getty Images)
The logo of Czech car maker, Skoda. (Jacques Demarthon/AFP/Getty Images)
MLADA BOLESLAV, Czech Republic—The car manufacturer Skoda Auto, based in the city Mlada Boleslav, ordered a three-week long vacation for its more than 20,000 employees this week. This amounts to about a half of the total population of the city, located about 50 km northeast of Prague.

Skoda Auto recently fired about 2,500 foreign workers, and plans to reduce the work week to four days over the following six months. The unions secured an agreement with the company management that workers will get 75 percent of the lost salary for the missing fifth day.

The extended holidays are just the latest measure in the face of the gloomy economic outlook; the company’s depots already have too many unsold cars in them.

Service providers in Mlada Boleslav have also started to feel the impact of the financial crisis, with fewer customers and less sales. Housing prices have dropped, and the real estate sector has almost halted.

The Czech car industry employs about 130,000 people, but experts say about 10 percent will lose their jobs in the first half of the following year.

Peter Sedik
Peter Sedik