Dipl.-Ing. Erich Schmitt: The importance of automobile industry in Catalonia

Since the first car was manufactured in Germany, a good many years have elapsed. The only adjective that can pro­­perly be applied to the development of the auto­­mobile industry since its be­­­ginnings is spectacular. The latest world figures bear witness to this: more than 56 million ve­­hicles manufactured last year, production equivalent to two trillion euros, more than five per cent of the world’s total GDP, direct employment for more than eight million persons in the car in­­dustry, in addition to indirect em­­ploy­ment for many more, according to data from the International Organi­za­­tion of Mo­tor Ve­­hicle Manufacturers (OICA).
These data clearly show that the auto sector is a growing industry globally, and is a bedrock activity for national econo­mies.
This certainly holds true for Spain, a country which has a highly developed automotive sector, and is second to none from the point of view of levels of quality and diversity of product (including saloon cars, off-road vehicles, light and heavy commercial goods vehicles). To­­ge­ther with construction and tourism, the car in­dus­try is one of the country’s economic main­­stays. It invoices almost 47 billion euros, and accounts for nearly six per cent of Spain’s GDP. The sector also provides indirect and direct em­­ployment for ten per cent of the country’s working population.


These figures provide Spain with an en­vious share of the world’s production of motor vehicles – 4.5 per cent – placing it third in Europe after Germany and France, and in front of countries like the United Kingdom and Italy. It ranks seventh in the world, behind the United States, Japan, China, Germany, France and South Korea. Export-wise, Spain comes fourth behind Japan, Ger­many and South Korea.

If to these figures we add that Spain pro­­duces nearly three million vehicles, al­most 82 per cent of which (2.5 million) are ex­por­ted (in other words, a quarter of all Spa­nish exports), this will give an idea of the importance of the motor industry to the Spanish economy as a whole.

Noteworthy is the strong investment made over the past five years by vehicle manufacturers established in Spain – the sum total being 1.7 billion euros per year. In addition to research and development (R&D), a major part of the in­­­vestment is earmarked for environmental protection in order to comply with current regulations as well as keeping fuel consumption and polluting emissions to a minimum, while using recycled material.
Thus the automobile sector is ground-breaking in the introduction of organiza­tional and technological innovations, to such an extent that it is a first order indicator in developed economies for its capacity to induce economic activity.
Within Spain itself, there is no doubt that Catalonia is where a good part of Spain’s industrial fabric is concentrat­ed, making it a clear driving force be­­­­hind the general economy. This can be seen by the fact that general industrial production in Catalonia grew at a rate of 3.5 per cent for the first ten months of 2006, the highest rate since 1998, ac­cording to Barce­lona’s Cham­­ber of Com­merce. This growth came mainly on the back of strong ex­­ports, which increased by 11.5 per cent, the sharpest hike of the past five years, particularly in the case of sales outside the euro zone (19.9 per cent in­­crease).
The fact that Ca­­talonia is one of the most dy­­nam­­ic areas within the Spanish economy has not gone un­­noticed by motor vehicle manufacturers, who have seen in this region an ideal enclave to set up production centres.


This can be seen in the fact that, of the 18 production centres belonging to twelve companies established in Spain, four are to be found in the province of Bar­celona in Catalonia.
This provides good proof of the importance of the automobile sector for the city, and this has not happened simply by chance. Barcelona has gradually carved out for itself the reputation of being the entry door to Europe as well as a platform for in­­coming and out­­going flows of goods and passengers, a situation that has con­­tributed largely to the fact that the automobile industry has grown not only in volume but also in business activity.

No doubt this has had an influence on the fact that the city of Barcelona and its province have become an important pole of attraction for companies within the automobile sector, while at the same time occupying a privileged position for certain activities directly re­­lated to the production of motor vehicles, such as car design. The quality of life in the city of Barcelona and its surroundings, the mediterranean light and climate, the open, friendly nature of its people – these elements make it an ideal place for business in this sector, and therefore provides the headquarters for nu­­merous automobile design centres. ,

This is also the case for SEAT, the only car manufacturer based in Spain ha­ving the capacity to design, develop and produce its own cars. To this end, it has its own Technical Centre which, by use of state-of-the-art technology, em­­braces not only design proper but also research and development, providing clear proof of the brand’s on-going, constant development both for its pro­ducts and production centres.

Further evidence of the brand’s dynamic activity in R&D can be found in the implementation of advanced concepts for vehicle development, in the use of powerful simulation and calculation tools, participation in research programmes within the European Union, as well as continuous collaboration with technol­ogical development centres specialized in industrial design for the automo­bile industry.


Taken together, this provides a good example of the investment effort put in by the brand over the 60 years that the company has been established in Ca­ta­lonia, a community in which it has very strong roots – more specifically in the province of Barcelona, where the company has its production centre (located at Martorell) as well as its diverse faci­lities in the Barcelona Free Port.

From these vantage points, the brand works day-in day-out on the development and production of vehicles whose identifying features are design, vitality and a sporty character, values reflected in the brand-claim “SEAT auto emo­ción”.
The innovative, ground-breaking spirit of the company is enshrined in its se­­v­en models – Alhambra, Altea, Altea XL, Cór­doba, Ibiza, León and Toledo. With the exception of the Alhambra (manufactured in Palmela, Portugal), all the other models are produced at the highly innovative Martorell plant. The international character of the brand is attested to eloquently by the fact that it distributes its vehicles in 72 countries, and ex­ports two-thirds of its production. Cur­rently 80 per cent of its sales and assistance points are concentrated in Western Eu­rope.
All this makes SEAT, a Spanish company forming part of the German Volks­wa­gen Group, the foremost industrial com­pany in Catalonia, both by the yardsticks of turnover and number of persons em­­ployed.

It is no coincidence that currently the SEAT Group provides jobs for more than 24,400 persons, and that indirect em­­ployment is further generated for thousands more in ancillary companies.

In a nutshell, a hefty investment effort, which provides eloquent proof of the faithful commitment to Barcelona and Catalonia of Spain’s only automobile ma­nufacturer. Over the past half century of the brand’s existence, this re­­gion has been witness to the development of the brand, which is intimately linked to the economic and industrial development of both Catalan and Spanish society.

Against this background, the company looks confidently forward to a promising future, encouraged by its mo­­dern range of models coupled to a ground-breaking labour relations environment, which will enable it to consolidate its presence in the market, and to continue in the competition arena for many years to come.

14725The author, born in 1946, studied Me­ch­anical Engineering, graduating in 1969. He then occupied various ma­nagement positions in the automobile industry. Since October 2006 Erich Schmitt has been president of the Executive Board of SEAT, S. A.