Skoda-Pilsen

Skoda Plzen is today unrelated to the auto-maker Skoda, though both companies share a common history. Trading companies in the defense industry are required to have licenses. In 1995, four firms, Aero Vodochody, Zenit Prague, Omnipol and Ceska Zbrojovka Uhersky Brod, were responsible for 94 percent of arms exports. Omnipol enjoyed a monopoly in the Czech arms trade from 1968 until 1989 and developed extensive international contacts during this time. In September 1996, ninety-seven firms, including engineering conglomerate Skoda Plzen, had a military arms trading license.

The Skoda arms factory at Plzen (Pilsen) was almost as famous as that town's brewery. Skoda was the world famous Czech center of development for all types of arms, both light and heavy. Emil Skoda began manufacturing arms in Plzen in 1890, and the Skoda Works produced large quantities of munitions in both world wars. Officially known as the VI Lenin Works during the Soviet era, the Skoda Works was a diversified enterprise.

Austria-Hungary was one of the world's major manufacturers of arms. Bohemia was the economic powerhouse of the empire, containing over 70 per cent of its heavy industry (including the vast Skoda arms-production complex in Plzen [Pilsen]). The Skoda company in Bohemia was the largest single arms producer, fully meeting the empire's requirements with considerable output available for export. Skoda arms production complex provided superb heavy howitzers and mortars that would prove immensely valuable in 1914 in reducing Belgian fortresses. The Skoda works produced the famous Austrian howitzers, one of the most effective heavy artillery weapons used by the Central Powers in the war. During the Great War the Austrian artilleryman was the best on either side; perhaps he was second to the Frenchman in handling the lighter guns, but certainly he was second to none in the manufacture and the handling of the heavier Skodas. Nevertheless, Skoda appeared distinctly behind Krupp and Schneider in the second ranks for artillery exports.

When the Austro-Hungarian Empire vanished in the aftermath of World War I, the new state of Czechoslovakia was left with the huge Skoda arms manufacturing complex at Pilsen. In 1919 the famous Skoda arms and ammunition works near Pilsen, was nationalized. A new council was named to conduct the works, comprised of six Czechs and three Frenchmen. After World War I the bulk of production was converted to civilian profiles with the help of French capital. Schneider and Skoda divided the execution of these orders between them according to the 1922 Convention. After the War Schneider-Creusot, or Creusot, as it is more commonly known, gobbled up the far-flung Skoda interests. The result was that Creusot had its tentacles in nearly all the countries of Europe, with munitions and arms. The Skoda arms industry accounted for 10 percent of all the country's exports before 1939.

When Hitler gobbled up the Sudetenland, he also got the formidable Czech border defenses. Shortly after Britain and France gave in to Hitler over the Sudetenland, he gobbled up the rest of Czechoslovakia, including the famous Skoda arms factories. The seizure of Czech Army stocks and of the Skoda arms works, second only to Krupp's, represented a major reinforcement of German strength. Hitler’s quick absorption of the whole of Czechoslovakia, included the famous Skoda ironworks, and Germany subsequently used the conquered nation as a Nazi arsenal. The absorption of the Skoda arms works provided valuable alternative information for German designers. The massive Skoda arms firm was producing some of the most technically advanced weaponry in Europe, including the famous “ bren” gun beloved of the British army.

The Germans went to great lengths to protect the Skoda arms factory at Pilsen in Czechoslovakia. To confuse Allied bombers, laborers drafted by the Germans constructed an elaborate wood and canvas replica of the Skoda arms works in Czechoslovakia. On the night of 16 April 1943, "Bomber" Harris sent out more than 300 Lancasters to make the long flight to Pilsen, Czechoslovakia, where they would bomb one of the largest armaments complexes in Europe, the Skoda Works. Since the target was far beyond the range of Oboe radio navigation, the attack used H2S radar. The H2S operators mistook the town of Dobrany for Pilsen (a 12-mile error) and a large mental hospital for the Skoda Works. Two hundred eighty-five bombers proceeded to deluge the area with 691 tons of bombs — a nightmarish absurdity that even Franz Kafka would have found difficult to express. The attacking force suffered grievously too. It lost 36 aircraft, more than 12 percent of the attacking force. In the remaining large raid of May 1943, Harris tried again for Pilsen. This time 150 bombers correctly identified the target, but landed almost all their bombs in a field outside the plant. On 25 April 1945 the last Eighth Air Force heavy bomber combat mission struck Skoda Armaments at Pilsen, Czechoslovakia, and various marshaling yards. The Skoda Works led a charmed life throughout the war.

As World War II ended, the United States Army began the occupation of Germany. The surrender of the German armies had left war equipment all across Germany, and in the U.S. sector, roughly Bavaria, the Army began to collect weapons and armed vehicles to feed American steel mills after the war. But looking over the last battlefield, General George S. Patton, Jr. saw not just enemy equipment, but an opportunity to study the German equipment and learn from it. At his inspiration, selected equipment was reserved for shipment to Fort Knox. One of Patton’s last diary entries recorded a visit to the Skoda factory, a major arms producer in Czechoslovakia, where Patton noted that U.S. designers needed to look at a suspension system developed there.

The partnership between Skoda and Westinghouse had been working since 1990, and resulted in the successful completion of the Temelin Nuclear Power Plant units in the Czech Republic. Fuel for the Temelin plant is being supplied by Westinghouse as part of the plant's upgrading and completion. The fuel was manufactured in the United States, with the Czech Republic's Skoda Plzen participating in fuel testing and development. The first of 60 CASTOR casks designed by Germany's Gesellschaft für Nuklear Behälter and manufactured by Skoda Plzen were delivered to the plant in January 1996. Skoda expected to be able to manufacture 20 casks annually. Skoda Plzen, which made heavy component sets for VVER reactors, obtained American Society of Mechanical Engineers (ASME) certification.

In the Czech Republic, conversion - exchange of HEU for LEU - was done in 2 research reactors by 1998. These are the LVR-15 research reactor (power up to 10 -15 MW, burning IRT - 2M type fuel from Russia), operated by the Nuclear Research Institute in Rez near Prague and the VR- I training reactor (power up to 5kW, IRT-3M type fuel ), operated by the Faculty of Nuclear Sciences and Physical Engineering, Czech Technical University in Prague. Both reactors have a number of common design features, e. g. stainless steel reactor vessels (made by SKODA Nuclear Machinery, Co.), core support plate, control rods etc.

By 1991, in Skoda-Pilsen the overhanging fear of the loss of 35,000 jobs had induced a paralysis to action. In the case of Skoda Pilsen, individual assistance was made ineffective by the presence of poor management and government indecisiveness. Skoda-Pilsen was a huge conglomerate employing 38,000 people and dominating the city of Pilsen. Its principal product divisions and the principal sources of major losses were nuclear power, power equipment, and locomotives. Skoda-Pilsen was created very much in the Soviet style of organization. Moreover, it was in businesses of which some, notably nuclear power, were very difficult to conduct profitably. It was, therefore, almost inevitability inefficiently run.

Skoda-Pilsen had a massive debt load that resulted in its de facto bankrupt position. This was caused by the losses from the major product lines and the unwillingness or inability of its customers, also government-owned, to pay their debts. Hanging over all of this was the fact that there has been no work-out plan for Skoda-Pilsen's bankruptcy. The Government's overriding concern was the unemployment issue potentially facing this enterprise. This seemed to have periodically paralyzed the will to act. Skoda-Pilsen had critical periods in which is had not had good top management. This kind of a complex of operating and financial problems, all with strong political overtones, was typical of the state of the large, Soviet-style conglomerates in Eastern Europe.

SKODA HOLDING a.s. was created on the basis of financial and organisational restructuring. It is the sort of financial holding, which financially and methodically manages its subsidiary companies. 100 percent share is owned by the international investment group - Appian Group. Together with its subsidiaries, Skoda Holding a.s. had a headcount of 4,300 employees (in connection with the sale of a new number of branches to new owners - c.f. the Appian Group and SKODA HOLDING introduce their development strategy - more than 4,000 former employees of Skoda Holding transferred to new owners since 2000; conversely, new acquisitions - VÚKV, Sibelelektroprivod, and SKODA Vagonka - have brought in 1400 more people).

Skoda Diesel, a.s., founded in 1899 in the Czechoslovakia, has produced hundreds of diesel locomotives and thousands of diesel and gas engines. Its products meet or exceed the most demanding technical requirements. Among the shareholders of Skoda Diesel is Skoda Plzen, a.s., one of the largest producers of steam and turbine generating systems in the world. With Skoda's impressive lineage and with the reputation of the Czech Republic as one of the foremost industrial nations of the world, the Company's sales efforts are greatly enhanced.