Paying 5,000 to 15,000 euros for a car that cost more than 38,000 euros to make seems like a bargain, does it not? Well, this is not a BMW or Mercedes promotion, this is about the Aro vehicles!
Romanian carmaker Aro made a little more than 1,300 cars in 2002, and spent over 52 million euros in the process. This means that every car cost Aro more than 38,000 euros. The sale price of the Aro vehicles, however, ranges from 4-5,000 euros (VAT not included) for the Aro 10 model (1.6l engine) to 15,000 euros for the model equipped with Toyota Turbo Diesel engine (2.5l).
What does this mean? That the State is practically the most lenient merchant in Romania: it sells a car for at least 23,000 euros less than it really costs. The price gap is covered by the others, i.e. the taxpayers.
Aro posted about 20 million euro turnover last year and its losses were in excess of 30 million euros.
“No matter if we make one car or one thousand cars, we still have a constant expense component. Moreover, we hardly had any work last year, so people stayed at home and were paid 75% of their wages,” Nicolae Matea, Aro general manager said.
PM Adrian Nastase told a TV show that Aro, or part of it could become profitable in a matter of weeks. “We could start bankruptcy procedures for Aro right away, but this is an issue related to the very industrial identity of Romania. The moment we declare Aro bankrupt, all the Aro cars in Romania will be left with no spare parts,” Nastase said.
However, not even the general manager of the company is that optimistic.
“We cannot turn Aro around in such a short period of time. We owe more than 200bn ROL to our suppliers. We need at least 80 or 90bn ROL to resume production,” Matea said. He added Aro would need to sell more than 4,000 vehicles a year in order to post profits.
“Until now, we’ve got firm orders for nearly 2,500 vehicles for this year,” Matea concluded. This is actually the main problem of the Romanian carmaker, which is always announcing orders for 4-5,000 units or more early in the year to actually make 1,000-1,500 cars by yearend that end up sold to the Interior or National Defence Ministry anyway. ionut.bonoiu@zf.ro