Restructuring of the Commercial Vehicle Industry in the Czech Republic

Abstract

This paper employs a case-study approach to examine changes in Czech truck and bus manufacturing in the 1990s. Three truck manufacturers (Tatra, Liaz, and Avia) and one bus producer (Karosa) are the focus of detailed analysis. In particular, the paper investigates enterprise behavior before privatization, privatization methods, enterprise restructuring and its effects on production, and financial health of enterprises. The paper documents the failure of voucher privatization of these enterprises to create an efficient ownership structure and improve collapsing truck production. Also, as the case of Avia illustrates, foreign direct investment does not necessarily result in successful enterprise transformation. Journal of Economic Literature, Classification Numbers: F21, L20, L62. 11 figures, 56 references.