Jabil in Osijek: Where the American Project Ranks Among the 10 Largest Investments in Croatian Industry

The announced construction of a large factory in Osijek for the production of medical prosthetic parts and microchips, as well as motherboards for the automotive industry, has attracted significant media attention. Although representatives of the investor, the American company Jabil, have not yet provided an estimate of the investment value, it is mentioned that this will be one of the largest investments in Croatia and that Jabil will become one of the largest employers in Slavonia.

In terms of employment, with 1,500 workers, the new company will be the second largest employer in Slavonia, right behind the Fortenova group, which employs around 2,100 people in just three large agricultural complexes – Belje, Vupik, and PIK Vinkovci.

The situation with the investment is a bit more complicated, as the value of the announced investment can only be estimated for now, but the opening of 1,500 jobs in the high-tech sector will certainly place Jabil among the largest investors in Croatia. We estimate that their investment will exceed even that of large state infrastructure projects. The most expensive so far, the Pelješac Bridge, was valued at around two billion kuna (265 million euros). An even more expensive project has just begun. The cost of reconstructing the existing and building a second track on the railway from Hrvatski Leskovac to Karlovac is expected to be nearly 360 million euros. A somewhat more modest expense is for the second tube of the Učka Tunnel, which is expected to be operational next year and is valued at around 200 million euros.

The new investment in Jabil’s Osijek facility gains additional value when it comes to manufacturing investments. Moreover, it is a so-called greenfield investment (which are rare), rather than the acquisition of existing companies or production programs or market shares.

The largest industrial investment in the last five years is associated with the Rimac Group. Investments in the automotive industry in the Mate Rimac complex are approaching around one billion euros. For example, the construction of a campus in Kerestinec near Sveta Nedelja is estimated at over 200 million euros. The project for the development of an electric robotaxi – which started in 2019, with a planned completion in 2025 – is worth 450 million euros (of which about 200 million euros is financed by the EU).

After many years of preparation, LNG Croatia completed the construction of a terminal on Krk and the conversion of an FSRU ship worth 234 million euros in a relatively short time two years ago. Unlike the media-covered LNG, the Austrian Kronospan quietly built an additional production hall in Bjelovar with a new particleboard production line, investing over one hundred million euros in four years. An additional interesting fact is that this was a former company of Zdravko Mamić, who was also the director before the sale in 2014.

BAT allocated 80 million euros for new production lines at TDR in Kanfanar, while Podravka’s investment in the new Belupa factory is estimated at around 70 million euros.

Job Value Between 200 and 500 Million Euros

Among new projects, the Slatina-based NutriS stands out. Zvonimir Sedlić, after selling his company Sedlić agro, partnered with the Danish group SiccaDania and invested around 30 million euros as equal partners in the construction of the first European hybrid factory for the production of protein isolates, starch, and fibers.

A similar amount was invested by Plinacro, which launched the first compressor station in the gas transport system at the beginning of 2020.

Next on the investment ranking list is Press Glass. The Polish founder invested around 27 million euros in the construction of a production facility in the Jalžabet Business Zone over five years, until 2020. The American Legget & Pratt invested over 18 million euros in expanding the capacity for producing wire cores for mattress production at Prelog’s LPT.

We close the list of the ten largest investments in Croatian industry with the Bauwerk Group Croatia, which invested 18 million euros in the construction of a facility for primary and final wood processing, accompanying infrastructure, and machinery procurement in Đurđevac.

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photo Source: Lider

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Where could the latest American investment in the Osijek factory, which will be engaged in production for the medical and automotive industries, fit into all of this? The value of a new job in the automotive industry is estimated at around 130 thousand euros, while Podravka allocated 70 million euros for 200 new jobs in the new Belupa facility (350 thousand euros for each job).

According to this logic, 1,500 jobs in Osijek could cost between 200 and 500 million euros. Even when deducting 2.5 million euros, which Osijek saved investors with its incentive measures, this project – if realized – will rank second on the list of new Croatian industrial investments.

And if Matt Darko Sertić is correct – who once estimated that starting advanced microchip production would require building a factory with a clean room interior, and that it would cost around one billion dollars – the Osijek project would become the largest greenfield investment in Croatian industry.

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