BRATISLAVA -- PSA Group and Kia are forecasting higher production at their plants in Slovakia this year, giving a boost to the central European country's economy.
The country of 5.4 million people is home to three car plants and is expecting a fourth to come online in 2018, once Jaguar Land Rover completes a 1.4 billion euro ($1.6 billion) factory it agreed to build last year.
With production set to again top 1 million cars this year, according to industry experts, the JLR plant will add to a car industry that is already a driving force of the local economy.
After producing a record 338,000 cars in 2015, Kia expects output at its Slovak factory to rise again in 2016 thanks to growing exports to recovering markets in the euro zone, Kia Slovakia President Eek-Hee Lee said.
That growth is helping to offset tougher conditions in Russia, he said. "We expect another record year. The Russian market is difficult right now but we are trying to expand our markets to western Europe," Lee told reporters on Thursday.
Kia builds the Cee'd compact car, Sportage SUV and Venga minivan at its Zilina, Slovakia, factory, according to the Automotive News Europe plant assembly map.
PSA also expects a 5 percent rise in output at its Slovak plant after last year's output of 303,000 cars, plant director Remi Girardon said.
PSA's Trnava factory produces the Peugeot 208 subcompact and C3 Picasso small minivan.
Volkswagen Slovakia said last week that it expected 2016 production to remain at the 2015 level of almost 400,000 cars. VW Group's factory in Bratislava builds the VW Touareg and Audi Q7 large SUVs, VW Up, Seat Mii and Skoda Citigo minicars, as well as bodies in white for the Porsche Cayenne and Bentley Bentayga SUVs.
The Slovakian car industry employs 250,000 people both directly and indirectly and represents 44 percent of the country's industrial output. Most of the production is exported, lifting an economy expected to grow by 3.2 percent this year and which has been an outperformer among euro zone members.
In its latest outlook in February, the finance ministry said car production would help to push growth in the coming years to levels last seen before the global financial crisis.