MLADA BOLESLAV, Czech Republic - Hella and Behr have signed a new strategic co-operation agreement to supply Skoda with front end modules and air conditioning systems.
The two German companies are to set up a joint venture in the Czech Republic, close to the Skoda plant.
Production is planned to start mid-1999. The facility will employ 150 people with a projected annual turnover of $75 million.
Lippstadt-based Hella KG Hueck & Co and Stuttgart-based Behr GmbH & Co already co-operate in several world markets. The Skoda facility will be the first to emerge from their new agreement to extend development and production collaboration.
'A high proportion of both partners' components and systems are contained in a front-end module,' said Hella spokesman Ulrich Koester. 'The aim of the co-operation agreement is to use joint development and production experience in order to maximize synergy effects.'
Skoda has already invested in a fractal factory system in which major suppliers are integrated into their Mlada Boleslav assembly operation. Ten suppliers are involved so far.
Hella has produced more than 500,000 front ends for VW at its Meerane plant in Saxony since 1991. It is currently extending similar activities in Mexico and Brazil.