05-10-2012

In Business News this week: Czech energy giant ČEZ excludes Areva from Temelín tender; EU stress tests reveal potential safety risks at Czech nuclear plants; largest Czech forestry firm goes bankrupt; Czechs continue to spend less on consumer goods; and truck maker Avia plans to expand to US market.

ČEZ excludes French firm Areva from Temelín tender

The Czech state-owned energy company ČEZ on Friday excluded the French firm Areva from a multi-billion dollar tender to build two new blocks at the Temelín nuclear power plant. Without giving further details, ČEZ said in a press statement the French company failed to meet the tender’s requirement for the construction of the two new reactors as well as other criteria. Areva can still appeal the decision. Two other bidders – the US firm Westinghouse and Russia’s Atomstroyexport remain in the running; the winner should be announced next year while the two reactors should be completed by the year 2025.

EU stress test reveals security issues at Czech nuclear plants

A European Union-wide stress test of nuclear reactors has revealed potential safety risks at the two Czech nuclear power plants at Dukovany and Temelín. The tests, whose results were released this week, focused on the nuclear plants’ preparedness for extreme events such as earthquakes and floods. The Czech authorities were advised to invest into the improvement of some of the systems including the protection of its diesels pumps against flooding and the plant’s system of return circuits.

According to the plant’s operator, ČEZ, the results showed no shortcomings but rather room for further improvement. However, some Czech MEPs slammed the tests as an attack on selected nuclear plants which could herald a campaign against nuclear energy itself.

Largest Czech forestry firm goes under

A court in Prague this week launched bankruptcy proceedings against the largest Czech forestry firm Less & Forest. The firm owes over two billion crowns to Czech banks and other creditors and was unable to meet its financial commitments. Less & Forest blamed its insolvency on a series of investments and business disputes with the state company Lesy ČR which administers over 126,000 hectares of state-owned forests. The company management said it was looking for a strategic partner; some media reports point to the agriculture giant Agrofert which provided a 311-million crown credit to the firm.

Czechs continue to spend less on consumer goods

Czechs in August continued to spend less on consumer goods, mainly on food and cars, as retail revenues fell by 0.8 percent in that month, according to the latest figures released by the Czech Statistical Office. The decrease was primarily caused by weakening demand for cars and lower spending on food which fell by 0.3 percent. One of the few segments that registered growth was clothing where retailers saw an increase of 6.8 percent, mainly thanks to seasonal sales. Analysts say the weakening consumer demand was negatively affected by decreasing real wages and the government’s austerity measures.

Truck maker Avia plans to expand to US market

The Czech-based, Indian-owned truck maker Avia has announced plans to expand to the United States, the daily Hospodářské noviny reported on Friday. The company plans to assemble its light trucks in the United States and eventually sell some 2,000 trucks a year, which represents a two-percent share of the US market. Avia has reportedly found a local partner that would be in charge of production in the US. All parts would be made in the Czech Republic except the engines which would be produced by the American firm Cummins. A contract between Avia and Cummins anticipates that 250 Avia trucks would be delivered to the US next year.

05-10-2012