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This newsletter has been prepared weekly both in English and Serbian.
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ORAH Investments Newsletter # 36

Car Industry in Serbia - Zastava Motor Works!
Interview with Mr. Malcolm Bricklin
23.10.2002.

Dear Friend,

The purpose of this newsletter is to inform you about the current
economic situation in the Balkans as well as to make you aware of the
right moment for your participation in and your benefit from the
regional economy development.

We shall be glad to assist and help you thanks to our strong local
presence and network.

http://www.orah.com


The editor's corner this week:
Car Industry in Serbia - Zastava Motor Works!

Regarding the news that Zastava Automobili signed
pre-agreement with US partner Nucarco which envisages
establishing of the joint venture Zastava Motor Works we
are publishing an interview with Mr. Malcolm Bricklin founder
of NUCARCO Inc.


"I have driven Zastava's cars with Peugeot's engines and I was
very, very impresed. I was impresed primarily with the quality,
because this year Zastava's employees, despite a difficult
environment, they have made great strides and have kept the
quality, and even improved the car. In front of us is a long road, and
with the help of people, old and new friends that really want to learn
how to enter 21st Century. With that attitude we cannot fail, we can
only suceed." This was told to Tanjug (Yugo Pres agency) by Mr.
Malcolm Bricklin, the creator of the Yugo-miracle in USA in 80's,
and controlling owner of the company working with Zastava, ZMW.

Everything started when Malcolm Bricklin in the mid eighties visited
Serbia and saw the cars at Zastava. Everybody told him that Yugo
will never be sold in USA, because not all of the standards
regarding the quality, design and safety can be met.

"I brought my people to Kragujevac and we concluded that we can
sell the car in the USA, if the vehicle could have a good price, we
knew that we would have a great market" - remembers Bricklin. He
decided to bring specialists that would tell him what needed to be
done to bring the car to the USA market. Zastava did everything it
needed and invested great deal of work.

After a year and a half, the first Yugo arrived in the USA. It met all of
the tough US standards. Bricklin also remembers proudly "that was
the fastest growth in sales of an imported vehicle from Europe. In
just first year 50,000 vehicles were sold from the total of 163,000.
They had just two doors, and without an automatic transmision.

Unfortunately after a good start, problems were created. In the
beginning everybody worked and the were dedicated because pride
had driven the workers to give everything, but afterwards, Bricklin
states, money needed to be used to motivate the pride.

"We came downstairs and said that we wanted to give bonuses"
says Bricklin. "The answer was that not only a few can get
bonuses, but everybody". We realized that the system did not allow
to only reward the employees directly responsible with the proces.
After that because of numerous problems the quality of the
automobile declined, that was unaceptable. The deal was stopped."

Last year some people from Zastava contacted Bricklin with
information. He was asked if he could visit, just to see his "old
friends".

"First I said to myself, I will not go there, because the same thing
will happen, we will work very hard and the system will ruin
everything. But I canged my mind and decided to go. I was offered
the factory at that time".

As Bricklin says, the last thing he needed was one more factory. In
70's he built a factory in Canada, and lost a great deal of money.
However in Kragujevac, he realized that it was the only way to
guarantee the quality that the vehicle must have. After very long
negotiations, talks to the gurus of auto-world, and talks with his own
team, Bricklin decided to work once more with Zastava. This time
he will sell cars with 2 and 4 doors, pick-up, and a cabrio, and since
the engines will be purcased from outside Serbia, all of the strict US
standards will be fulfilled. The price will be very attractive for US
buyers.

Bricklin comments that 3 priorities will be put forth in the new
partnership: "We need sales, and my people will work at that
around the world. We need money to invest in the factory to finish
(painting areas, and the asembly lines)., and to fix everything else
that was ruined in the war, along with the computer room that was
leveled. We will need about $100 mil to bring everything up to the
level of production of 140-150,000 vehicles per year. For operational
capital we need an additional $50 mil, and then comes employee
training period.

Bricklin says that the employees of Zastava are very bright people
and are willing to learn, are very talented and adds "our goal will be
to retain the people over there, to increase our sales and to start
raising salaries so that our workers can live better. I never met a
group of people that had more talent and willingnes to work", say
Malcolm Bricklin.

His mother was from Rusian and his father was from Philadelphia,
Mr. Bricklin is the father of five and grandfather of five, as well as
former husband of three women. He will be 64 next Marc, maybe by
then the final contract will be signed. He has been in auto busines
since the sixties. He was the first to importe the Japanese Subaru
to the US market. In the seventies he made a car called the Bricklin
and in eighties he imported Pininfarina Spyder and Bertone's X1.9
(Alfa and Fiat). In those years, Yugo came to the US and in nineties
he developed electric bicycle.

"After I looked at everything, working with Zastava was the most
exciting. We have a factory that can make 250,000 cars for sales to
markets around the world, where every year 60-70 million cars are
sold. We have an attractive vehicle with a new interior design, air
bag, and some exterior canges that are cool looking and a great
engine. I think we can make a good busines, and help Serbia
because it deserves. We need to invest to help them come out of
situation that they are in." says Bricklin with a voice that brings forth
great optimism and willingnes to do exactly that.

To our last question about the destiny of the workers Malcolm says,
"The workers are great, and what we have negotiated with ministers
is that I will start sales around the world of Zastava's cars
immediately without canges, to sell them as they are now. The
worst thing that I could imagine is to start laying people off. I cannot
think of a worse scenario. On the other hand, it would not be smart
to have too many employees. Therefore my job is to sell as muc as
I can so we wouldn't have those kind of problems" I finished the
interview with Mr. Bricklin, at this moment he is the most promising
investor in Serbia.

Tanjug Pres
Washington 16.10.2002
By Dragan Atanckovic


Readers' feedback:
[EMAIL PROTECTED]
Tel: +381.11.311 34 42

PS Please forward this message to others. Your comments are highly
appreciated.

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 Auto industrija u Srbiji - Zastava Motor Works!

Povodom vesti o postpisivanju predugovora Grupe Zastava automobili
sa americkim partnerom Nucarco, koji predvidja formiranje novog
zajednickog preduzeca Zastava Motor Works (ZMW), objavljujemo
intervju sa gospodinom Malkolmom Briklinom osnivacem Nucarco
korporacije.


"Vozio sam Zastavin auto sa Pezovim motorom I bio sam veoma,
veoma impresioniran.Bio sam impresioniran pre svega kvalitetom, jer
sve ove godine Zastavini radnici su u nemogucim uslovima, uz velike
napore, odrzali kvalitet I cak ga unapredili.Pred nama je jos dugacak
put, sa ljudima, starim prijateljima ali I novim, koji zaista zele da nauce
kako da udju u 21.vek.Sa takvim stavom ne mozemo da pogresimo,
mozemo samo da uspemo". Ovo je danas izjavio Tanjugu gospodin
Malkolm Briklin, tvorac Yugo-cuda u Americi 80-tih godina, I vecinski
vlasnik sada zajednicke firme sa Zastavom, ZMW.

Sve je pocelo tako sto je Malkolm Briklin sredinom osamdesetih
godina bio u Srbiji i video automobile u Zastavi. Svi su mu tada govorili
da se Yugo nikada nece prodavati u Americi, jer ne mogu da se
ispostuju zahtevi u pogledu kvaliteta,sigurnosti, dizajna.

"Doveo sam svoje ljude u Kragujevac I zajedno smo zakljicili da
mozemo taj auto da prodajemo u SAD.Ako ta kola budu imala pravu
cenu, imacemo veliko trziste."priseca se Briklin I dodaje, da je tada
odlucio da dovede specijaliste koji ce reci sta sve treba da se uradi da
bi pocela prodaja. Tako je I uradio. Zastava je tada zaista uradila sve
kako treba, ulozivsi ogroman trud.

Posle godinu I po dana, u Ameriku je stigao prvi Yugo , koji je
zadovoljavao sve rigorozne americke propise. Uz to, seca se Briklin
ponosno, "bio je to, u americkoj istoriji, najbrzi uspon uvoza
automobila iz Evrope. Prve godine je prodato 50.000 automobila, od
ukupno prodatih 163.000 automobila sa dvoja vrata bez automatskog
menjaca ".

Na zalost, posle fantasticnog uspeha, pojavio se problem.Na pocetku
su svi radili veoma naporno , jer je ponos terao radnike da daju sve od
sebe.Posle je trebalo, kako Briklin kaze, novcem potkrepiti ponos.
"Dosli smo dole I rekli da hocemo bonuse", prica Briklin."Odgovor je
bio da ne mozemo samo mi da dobijemo bonuse, nego svi.Shvatili
smo da sistem nije dozvoljavao da se nagrade samo radnici koji su
imali direktne zasluge u citavom procesu. Docnije, zbog raznih
problema, kvalitet automobila je poceo da pada, sto je bilo
neprihvatljivo. Posao je prekinut."

Prosle godine, od nekih ljudi iz Zastave, do Briklina je stigla informacija
sta se tamo dogadja, sa pozivom da ih poseti i da bar pozdravi stare
prijatelje.

"Prvo sam rekao sebi da ja tamo necu da idem, jer ce da se dogodi
ista stvar - mi cemo naporno da radimo, a sistem ce sve da unisti.
Medjutim, predomislio sam se i odlucio da odem. Tada mi je bila
ponudjena fabrika."

Kako prica Briklin, poslednja stvar koju je zeleo je jos jedna fabrika.
70tih je sagradio fabriku u Kanadi I izgubio puno novca. Medjutim, u
Kragujevcu je tada shvatio da je jedina garancija kvaliteta, da ima
sopstvenu odgovornost u celom poslu. Posle napornih pregovora,
razgovora sa strucnjacima iz automobilskog sveta, razgovora sa
sopstvenim timom, Briklin je odlucio da ponovo radi sa Zastavom.
Ovoga puta ce se prodavati auto sa dvoja i sa cetvora vrata,pik-ap,
kabriolet, i, s obzirom da ce motori da se nabavljaju u inostranstvu,
bice zadovoljeni veoma strogi americki propisi.Cena ce biti veoma
atraktivna za zahtevne americke kupce.

Briklin istice tri prioriteta u buducem partnerstvu. "Treba nam prodaja, i
to ce moji ljudi da rade sirom sveta. Treba nam novac da unesemo u
fabriku, da se zavrsi farbara, linija montaze, i sve ono sto je unisteno
bombardovanjem, kao i kompjuterska soba, koja je sravnjena sa
zemljom. Bice potrebno oko 100 miliona dolara da se sve dotera za
proizvodnju od 140-150.000 kola godisnje.Za obrtni kapita treba daljih
50 miliona dolara. Onda dolazi obuka radnika".

Briklin kaze da su radnici u Zastavi veoma pametni ljudi, koji hoce da
nauce i koji su veoma talentovani i dodaje da ce "nas cilj biti da drzimo
te ljude tamo, povecamo prodaju i pocnemo da dizemo plate, jer
radnici treba pristojno da zive. Nikada nisam sreo grupu ljudi koja ima
vise talenta i volje da vredno i naporno radi.", istice Malkolm Briklin.

Od majke ruskinje i oca iz Filadelfije, g.Briklin je otac petorice sinova,
deda petoro unucadi i bivsi muz tri zene. Napunice 64. u martu iduce
godine, mozda bas kada se bude potpisivao glavni ugovor. U
automobilskom biznisu je od 60tih godina. Prvi je uvezao japanski
Subaru na americko trziste. 70tih je napravio auto koji se zvao
"Briklin", a 80tih je iz Italije poceo da uvozi Pininfarinin Spajder i
Bertoneov x1.9. Tih godina je prokrcio put Yugo-amerike, a 90tih je
razvio elektricni bicikl.

"Ipak, kada sve sumiram, najuzbudljiviji posao je sa Zastavom. Imamo
fabriku koja moze da proizvede 250.000 automobila za plasman na
svetskom trzistu, gde se svake godine proda 60-70 miliona
automobila. Imamo kola koja su atraktivna i, sa novim unutrasnjim
dizajnom, er begom,sa nekoliko spoljnih promena da izgleda vise kul i
dobrim motorom, mislim da mozemo da napravimo dobar posao, da
pomognemo Srbiji koja to zasluzuje, i koja mora da ulozi ogromne
napore da izadje iz situacije u kojoj je", kaze Briklin glasom koji odaje
veliki optimizam i odlucnost da sve to stvarno i ucini.

Na nase poslednje pitanje o sudbini radnika, Malkolm Briklin doslovce
kaze:"Radnici su odlicni,i ono sto cemo pokusati da uradimo, a i
dogovorili smo sa ministrima, je da ja odmah pocnem da prodajem
sirom sveta Zastavine automobile bez izmena, kakvi su sada. Najgora
stvar koju mogu da zamislim je da pocnemo da otpustamo ljude. Ne
mogu da zamislim gori scenario. Sa druge strane, ne bi bilo dobro
imati vise ljudi nego sto nam treba. Moj posao je, dakle, da vise
prodam, da ne bi imali takvih problema.", zavrsio je razgovor za
Tanjug, g.Malkolm Briklin, ovog trenutka najozbiljniji americki investitor
u Srbiji.

Tanjug Pres
Vasington,16.10.2002.
Dragan Atanckovic


Odgovor citalaca na:
[EMAIL PROTECTED]
Tel: +381.11.311 34 42
P.S. Molim te da ovu poruku prosledis svojim prijateljima. A tvoj
komentar ce nam zaista znaciti.

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