The Czech Republic’s essential connections with the European Union and sophisticated infrastructure made it an important warehousing and logistical location. The transport and logistics sectors account for as much as 10% of the country’s GDP, employing at least 270 000 people. The Czech Republic’s steady performance on the European logistical and warehouse market makes it an attractive option for industry-specific investment and expansion.
Warehousing and Distribution Facilities in the Czech Republic
The Czech Republic’s steady economic performance makes it an attractive option for business investment in all areas – its GDP was worth 246.49 billion US dollars in 2019 in comparison to 244.99 billion US dollars in 2018. The steadily growing economy of the Czech Republic attracted companies and investors from all around the world, which motivated strong attention to warehousing and distribution provisions.
In 2019, CTP announced that it will complete the Czech largest industrial park, CTPark Bor, over the next five years with the to-date investment of €400 million. The park will accumulate an area of 600,000 m2. Currently, some of the Czech largest warehouse parks include ctPark Plzeň with an area of 451,600 m2, ctPark Aš with an area of 285,700 m2, and Prologis Park Prague D1 East with a total area of 140,147 m2. Nearly 75% of all facilities are situated in Central Bohemia.
Transportation Hub
The Czech Republic remains the transportation and logistical hub of Europe. During the 16+1 Summit, the Czech Republic and China signed an agreement making the Czech Republic the logistical hub between China and Central and Eastern Europe. In addition to that, the Czech Republic has one of the best infrastructures in Central Europe. About 0,81% of the Czech GDP was invested in inland infrastructure in 2017. SZDS, the Czech infrastructure manager, is in charge of all main lines and most of the regional lines.
Since the Czech Republic is located in the heart of Europe, it is a convenient option for entering the major transportation corridors. The Czech Republic is a member of the TEN-T – the Trans-European Transport Network, allowing for fast and efficient transport of goods within the EU. The core network of this project will be completed by 2030, and the global network is expected by 2050. As a part of the project, the EU funded several initiatives in the Czech Republic, such as the reconstruction of Olomouc Railway Station.
Currently, the Czech Republic’s main markets for goods exports and imports are close neighbors, such as Poland, Slovakia, and Germany. According to the recent data, Germany remains the Czech Republic’s most significant trading partner and makes up for over 29% of Czech foreign trade turnover. However, with the implementation of the TEN-T, the main target markets might change and/or expand.
Here at YeYe, we manage transportation companies with the aim to establish better connections between the Czech and Turkish markets. We offer the carriage of Turkish products to the European markets, as well as the carriage of Czech products to Asian/Middle Eastern countries. One of our transportation companies is Best Forwarding partnering with GTL, which is the logistic center for Turkish producers and an incentive for establishing better trade connections between the countries.
As another example of our transportation company, Varlik Transport Czechia is providing its services to Western Europe through its mother company in Germany.
What is CLA?
In 1993, the Czech Logistics Association (CLA) association was founded, which unites the largest warehousing and transport companies within the country and abroad. It also offers solutions and investigates problems in the field of logistics in connection to business and economic activities. As of 2020, CLA is a member of the European Logistics Association (ELA) and of the European Certification Board for Logistics. As a member of the ELA, the Czech Logistics Association awards internationally recognized certifications in logistics technologies, operational and strategic management, supply chain management, business logistic, etc. The company remains an important initiative aimed at improving and expanding the logistical sector in the Czech Republic.
Any international company wishing to take advantage of the Czech sophisticated logistical market and its great location in the heart of Europe will enjoy favorable tax rates and many economic subsidies. The Czech Republic follows the trade regulations of the European Union, therefore a company can access the non-tariff consumer market and free trade with Iceland, Liechtenstein, Norway, and Switzerland through other agreements. Furthermore, the country offers better taxation rates than most neighboring countries, such as Germany. As a foreign investor, you will have the same property rights, protections, and investment opportunities as the local businesses. Some of the favorable subsidies include a 5-year property tax exemption and a 10-year corporate income tax reduction.
Who are some of the local players?
When it comes to logistics, the Czech Republic has many companies which it heavily relies on for import and export connections with the rest of the world.
TTV Transport is the largest land transport company in the Czech Republic, which provides important connections with Northern Europe. While they also offer transfers of goods pretty much anywhere else in Europe, they specialize in northern countries – especially, Sweden. They own more than 130 of their own vehicles, including 30 pieces of Norwegian equipment.
ČSAD Hodonín is a company with over 60 years of experience and with the logistics centres in Brno, Prague, Hodonín, and Slovakia. Together with 5 other companies, it participated in the establishment of EURALOG – the association with high warehousing capacities. It is a major provider of such services as the storage of goods, transport, customs services, etc.
TIP & PEMA is a transportation company represented in 17 different countries. It can offer a wide selection of transportation equipment, including 90,000 trucks and semi-trailers. They offer leasing, rental, maintenance, and repair services of the transport.
JHT CZ S.R.O. is an SSL and Česmad Bohemia member, which provides warehousing and transportation services, as well as maintenance and sale of vehicles. All of their vehicles are equipped with special tracking devices ensuring the goods reach their destination.
Branches of the Existing International Companies
GEFCO Group is a leading European automotive company with an existing branch in the Czech Republic. They provide services for over 10 different industries and govern a global supply network. As such, they transferred oxygen generators from Slovakia to Peru and Nepal.
UPS Supply Chain Solutions remains one of the biggest logistical companies in the world and an important Czech-market player for over two decades. They specialize in controlling and increasing the efficiency of the supply chain by offering one global transportation handler. They offer air freight, ocean freight, ground freight and a brokerage in the Czech Republic.
C.H. Robinson Czech Republic S.r.o. is one of the world’s leading logistical platforms with nearly $20 billion in freight and 18 million shipments annually. They accommodate over 119,000 customers and 78,000 contract carriers, including such businesses as Microsoft and Pepsico. Their Czech location is currently in Liberec.
Ekol.com is a Turkish origin logistics company which is located in 13 countries (including the Czech Republic) and partners with over 150 other locations. They operate with a strong focus on green logistics, which allows them to save enough diesel per month to make 360 trips around the world. Apart from transportation, they also offer a wide range of warehousing services.
Conclusion
The Czech Republic is one of the key logistical and warehousing centres of Europe. Its strong connections with the bordering EU countries, membership in the Trans-European Transport Network, stable economy, and developed infrastructure allow for the expansion of logistical and warehousing sectors. While the country already has many well-established local and international players in these fields, it still remains an attractive option for investment and expansion of those companies specializing in logistics.
At YeYe Agency, we have been helping transportation companies expand for over 6 years now. Varlik Transport Czechia is one of our best case practices. It is a logistics company with nearly 15 vehicles and its mother company located in Hanover. We helped the company expand to Czechia and registered a total of 10 tow trucks and 6 trailers for Varlik Transport Czechia. We are dedicated to providing high-quality services for transportation companies and allowing them to expand into new markets.
