Dancer buses introduced at Busworld in Brussels

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Vėjo Projektai, a company developing fully electric Dancer buses in the Klaipėda FEZ, introduced itself to the world last week at Busworld 2023 in Brussels – one of the most important passenger transport events attended by tens of thousands of people.

According to the company, visitors were most impressed by the exceptional design, lightness and cutting-edge technologies of the Lithuanian bus. The company hints that in the future, the Klaipėda-made bus will be seen not only on the streets of its hometown, but also in other European cities.

“We hope that the Dancer buses will soon be seen not only in Lithuania – two of our models and the e-mobility solutions offered with them have been of interest at the exhibition by passenger carriers from the Nordic countries, Germany, France, the Netherlands, Belgium and other European countries,” says Alvydas Naujėkas, the CEO of Dancer.

Busworld 2023 is one of the most important events in passenger transport, revealing the future of the sector. It is a good opportunity to meet industry leaders, potential partners and customers.

Visitors the Dancer bus stand could learn all about the two technologically advanced, 100% electric Dancer bus models – the fast-charging Dancer (FC 75) and the long-range Dancer (LR 530). The low-floor electric buses produced and operated in Lithuania have already saved almost half a million tonnes of CO2 emissions.

The fast-charging Dancer (FC 75), designed for dynamic cities, has an extremely fast charging time of just 8 minutes. The bus is also extremely economical, with an average energy consumption of 0.72 kWh/km, allowing it to cover up to 100 km on a single charge. These technical features, together with fast charging, make it easy to operate in urban areas.

US biotechnology company invests at Klaipėda FEZ FlexStart facility

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American capital biotechnology company Cureline Inc. is investing EUR 3.5 million in the construction of a new biotechnology plant and research laboratory in Klaipėda FEZ. The plant, laboratory and administrative premises will be located in the FlexStart facility. The start of operations is planned for the first half of 2024.

The new plant and laboratory will be managed by Memel Biotech, a subsidiary of Cureline Inc. group, VZ.LT reports.

Its CEO Agnė Vaitkevičienė says that the company will be involved in the production of medical products, including advanced therapy drugs for clinical trials, with direct customers being pharmaceutical companies and medical institutions worldwide.

“We will be the first in Lithuania to be able to develop this level of products for clinical trials. We will also be one of the few in the Baltic States and Poland. This market is not yet widely occupied in the region, but the global demand for such products is huge, so not only we as a company, but also Lithuania as a country has the potential to become a centre of advanced therapeutic technologies,” the company’s announcement quotes A. Vaitkevičienė, CEO of Memel Biotech, as saying.

According to her, Memel Biotech will be equipped with special premises complying with the standards for the production of sterile medical products, where innovative biotechnological products for personalised medicine will be developed and manufactured.

The estimated floor area of the plant with commercial premises is 850 sqm. The company intends to recruit up to 25 highly qualified professionals over the next two years. Until now, Cureline Baltic has had an administrative office and an animal laboratory in Vilnius.

Factory making sustainable construction components opens its doors at Akmenė FEZ

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A sustainable construction components factory began operations this week at Akmenė FEZ. What makes these sustainable wooden components special, and what are they used for, what makes this factory different from any other, how will it contribute to sustainable growth, and why is this a significant event for Lithuania?

Sustainable wood products for construction, or engineered structural wood, includes laminated veneer lumber, used for strong, compression-resistant joists, columns, facades, and other industrialised construction and renovation elements. Such lumber can replace highly-polluting materials used in the construction industry, such as cement, concrete, and reinforced concrete. More than 30 per cent of new buildings in Western Europe and Scandinavia are built using such sustainable, environmentally-friendly components.

The sustainable construction components factory that has begun to operate at the Akmenė FEZ is the first such factory in Lithuania and the third in Europe. Until now, there were only two such factories; both of them are in Norway. The owners of the factory at Akmenė FEZ is the global investment company VMG Group. The factory was built by AB Hanner and the UAB BRAITIN-owned fund Baltic Industrial Fund II. These companies’ extensive experience in their respective fields (industry, construction, and finance) created synergies and allowed them to efficiently implement the project, the value of which is €10 million.

The factory will start by producing laminated veneer lumber, two-ply joists, and construction chipboard, and later the product assortment will expand. The factory’s annual production capacity is 120,000 m3 of laminated veneer lumber, 15 million metres of two-ply joists, and 200,000 m3 of construction chipboard. Turnover is estimated to be up to €150 million. The factory will create 200 jobs.

Products made at the factory will supply the market in Western Europe, Scandinavia, and Lithuania. One of the advantages of engineered structural wood is the ease with which it can be transported, so export is planned to North America and Australia. Until recently, Australia imported such wood from Russia, but due to the changing political environment, agreements have been signed with producers in Lithuania. At present, negotiations are proceeding regarding export to the USA; there, production of structural lumber is concentrated on the West Coast, so for companies located on the East Coast it is cheaper to import such wood from Europe.

The new factory will contribute to environmentally-friendly construction in various ways, by supplying to the market natural, less-polluting products and by producing in an environmentally-friendly way. It is expected that the sustainable construction components made here will gradually replace the polluting materials in use until now, such as cement, concrete, and reinforced concrete.

Glassbel to partner Halio, a US smart glass innovator

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Glassbel Baltic, an architectural glass manufacturer operating in the Klaipėda Free Economic Zone (FEZ), has entered into a strategic partnership with Halio, a designer of the world’s fastest, most beautiful, eco-friendly, and technologically advanced architectural smart glass. This cooperation will allow the Klaipėda-based company to implement Halio’s solutions with light transmittance management systems in its products and distribute them in Europe, Middle East and other markets.

As part of the worldwide challenge of energy efficiency and sustainability in modern architecture, Glassbel, which exports to 30 countries on 4 continents, will now be able to offer smart glass facade solutions using Halio’s intelligent technology. The smart solution consists of glass products with an integrated Halio device that reacts to the changing environment, so that the glass darkens or lightens accordingly in real time, thus reducing air conditioning or heating costs. The American technology, which consists of a sophisticated combination of sensors, switches, chemicals, hardware, software and artificial intelligence, not only ensures human comfort but also makes buildings more energy efficient.

According to Valdas Virbalas, CCO at Glassbel Baltic, the agreement with the American company will allow Glassbel to strengthen its portfolio of innovative products.

“Such smart glass solutions are still a novelty around the world, which the market will have to accept, learn to work with and invest in. But sustainability and energy efficiency have been the dominant themes in new buildings for some time now, so we are delighted to add a relevant innovation to our portfolio and further strengthen our position in the market for innovative architectural glass. We are currently completing our first small real project with Halio technology and exporting it to Silicon Valley in the USA, where the business community is currently the most interested and involved in smart technologies,” comments Virbalas.

According to Bruce Sohn, CEO of Halio, Glassbel’s quality, expertise and wide geography of markets make this partnership highly valuable for both sides.

“This collaboration allows us to market groundbreaking technology to our customers in Europe and the Middle East. We’re proud to jointly offer the fastest, most eco-friendly, energy-efficient solution, and the utmost beautiful and highest-performing smart glass available in the market” says Sohn.

And according to Dmitri Sobolevski, CEO of Glassbel, Halio’s solution is the best on the market for speed, facade integrity and aesthetics.

“We are delighted to partner with the world leaders in smart glass technology. The Halio solution is revolutionary, significantly faster to react to changing environments, aesthetically neutral and durable, and technologically more robust than any alternative,” says Mr Sobolevski.

Eimantas Kiudulas, the CEO of Klaipėda FEZ, also welcomes this partnership, pointing out that Glassbel will be both more sustainable and more competitive with the US company’s technology.

“We are pleased that with this step Glassbel is strengthening several strategic areas of Klaipėda FEZ at once – high value-added manufacturing, application of new technologies, as well as environmental protection and sustainability,” commented E. Kiudulas.

Halio was founded in 2010 in California, USA. The company markets its solutions both on its own and through partners including Glassbel. Halio has raised more than 300 million USD throughout its history, including from SK Holdings, US sustainable investment fund Capricorn Investment Group and other investors.

Glassbel’s revenue last year was 22 million euros, a quarter more than in 2021. The company currently employs around 180 colleagues in Klaipėda.

Glassbel has been operating in the Klaipėda FEZ since 2009. The company exports more than 90% of its production, mainly to Ireland, the UK, the US, Western Europe, Saudi Arabia, Scandinavia and other markets.

A++ building for investors at the Baltic FEZ

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UAB “MLEZ Infrastruktūra”, which is a 100% owned subsidiary of UAB “Marijampolės LEZ valdymo bendrovė” (MLEZ), and UAB “Viešųjų investicijų plėtros agentūra” (VIPA) (Public Investment Development Agency) have signed a contract for the design and construction of a approx. 5440 m2 manufacturing building and the necessary infrastructure for it in the Marijampolė Free Economic Zone (Baltic FEZ). The project, which is being partially financed with the VIPA loan from the national budget of the Republic of Lithuania, is planned to be completed by the end of 2024.

“The macroeconomic indicators for the manufacturing industry do not inspire much optimism, and the situation is likely to worsen for some time throughout Europe, which will lead to a higher cost of money. Together with the Board, having carefully analysed market trends, we have decided that this is an excellent opportunity to lock in the price for borrowed money, to define the conditions for this loan with the lender and at the most difficult economic moment to reach favorable negotiating results with the contractors, with whom we plan to conduct detailed negotiations at the end of this year. Our objective, having locked in the prices for construction and contract works, is next year to build the manufacturing and warehousing areas under especially competitive conditions,” says Simonas Petrulis, CEO of MLEZ, presenting the plans for the near future.

We will offer this building to investors at the beginning of 2025. A distinct advantage is the fact that the building will be right next to the Via Baltica, the node for Rail Baltica 1 and Rail Baltica 2, and the Lithuanian-Polish border, where the FEZ will offer tax incentives and the most modern industrial infrastructure in the Baltic countries. In the adjacent city of Marijampolė, there are a wide variety of potential partners: the Vocational Training Centre, college, and strong companies operating in the food, wood, and metalworking industries. Take the right decision – together with MLEZ, plan the next stage of expansion for your business. Together with us, current and future clients gain a huge competitive advantage and accelerate the growth of their business.

Klaipėda FEZ investors’ taxes paid exceeded EUR 100 million

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Last year, the total taxes paid by more than 40 investors operating in the Klaipėda Free Economic Zone (FEZ) amounted to EUR 107.3 million and reached an all-time record. Purchases of goods and services by FEZ companies in Lithuania also reached an all-time high of more than EUR 500 million.

Last year’s war, as well as the energy, raw materials and inflation crises, and the signs of recession that started to emerge in the second half of the year, distorted the main indicators of Klaipėda FEZ investors. Although the total turnover of companies amounting to EUR 1.76 billion and exports of EUR 780 million are also all-time records, they were significantly affected by the sharp increase in raw material prices related to the pricing of several major investors’ products. Leaving these companies aside, the rest of the Klaipėda FEZ business community has shown moderate growth throughout the past year, but many businesses have faced deteriorating consumer sentiment in the second half of the year.

However, other Klaipėda FEZ business community results continue to show a strong and growing contribution to the regional and national economy. Last year, purchases of goods and services by FEZ investors in Lithuania amounted to EUR 505 million, or 84% more than in 2021. Around one third of this figure is accounted for by the biodiesel producer UAB Mestilla, which buys rapeseed and other raw materials from Lithuanian farmers.

The amount of taxes paid by the Klaipėda FEZ business community also reached an all-time high last year – EUR 107.3 million in social, revenue and VAT taxes were 42% more than in 2021. In comparison, over the past year, the FEZ investors received EUR 8.2 million of state aid, which in the form of taxes alone has paid back several times over.

Last year, existing and new investors in Klaipėda FEZ implemented investment projects worth EUR 45.8 million. The largest investments were made in new REHAU and Finegri factories, while Retal Baltic Films, Neo Group, Orion Global PET, Pack Klaipėda, Lavango Engineering, Glassbel Baltic, Mestilla and other companies invested in the expansion of their existing capacities and infrastructure.

The number of jobs in Klaipėda FEZ investors’ companies increased from 2,300 to 2,800 last year, while the number of employees in the whole FEZ territory was around 5,000 last year.

According to Eimantas Kiudulas, the Klaipėda FEZ CEO, companies in the territory not only demonstrated resilience in a difficult period, but also increased their contribution to the national economy. 

“It is still difficult to talk about large new investments, and the beginning of this year is not easy for business, but we are actively preparing for the expected recovery. A business community that is stable throughout all economic cycles will be one of the factors that will allow us to gain momentum as markets recover,” comments Mr Kiudulas.

Since the inception of Klaipėda FEZ in 2002, Lithuanian and foreign capital companies have invested or plan to invest EUR 778 million in the territory. Since 2011, Klaipėda FEZ investors have paid a total of EUR 591 million in taxes, while the state aid received during this period amounted to EUR 61.3 million.

Dovista, UAB enters a new phase of expansion

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Dovista started operating in the Baltic FEZ 5 years ago. Today the company enters a new phase.  The construction and installations works have already begun in the Production unit.  Windows of non – standart shapes and sliding doors will be produced here. From now until the end of 2023 more than 100 employees are planned to be employed in the company. 

Klaipėda FEZ and its partners joined ADMIRAL – a pilot project for more sustainable logistics

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The Admiral initiative, which brings together 21 partners from 9 EU countries, was officially launched in Espoo, Finland, in May, with the aim of creating a next-generation logistics service platform within 3 years to help reduce the environmental impact of the sector. The project’s Lithuanian partners include the Klaipėda FEZ Management Company.

According to the Admiral team, transport and logistics companies have so far been mainly concerned about their own pollution and energy consumption, but for this reason, less attention has been paid to the indirect environmental impact of the logistics sector. This is precisely the problem that the Admiral initiative will address by developing and promoting sustainable, multimodal, data-driven logistics solutions.

Admiral will focus on a next-generation marketplace platform to manage all supply chains and monitor the environmental impact of each link. The platform will aim to make multimodal logistics chains run more smoothly, make better use of existing capabilities and infrastructure, promote sustainable sourcing and other innovations. At the same time, the Admiral platform will aim to become an innovation hub for software developers who could create and teest new services. Admiral is expected to deliver not only a 20% reduction in the environmental impact of the logistics sector, but also to bring more transparency and resilience to the market.

The Admiral project members in Lithuania will be primarily responsible for generating digital documents and signatures between the different members of the logistics network. The Lithuanian part of the Admiral consortium will also take care of data integration and information dissemination in the logistics sector, and will develop solutions for the automatic calculation and distribution of CO2 footprints.

According to Darius Butvydas, Klaipėda FEZ Client Project Manager, although the transport and logistics sector is digitising, innovation in this business is rather slow and fragmented, the tools used by companies usually do not communicate with each other well, and there is almost no CO2 emissions calculation. The Admiral platform will seek to address all this.

“Klaipėda FEZ is participating in the project as a transport hub, i.e. we will provide our partners with our existing infrastructure (transport monitoring devices, 5G internet, etc.), while the other partner in the project, the logistics company CargoGO, will be testing digital tools in real time. Our data will be used to evaluate the improvements achieved. The pilot project is planned to be up and running within 36 months,” comments Butvydas.

The real outcome of the Admiral project, he says, will be a Europe-wide service ordering platform focused on transport and logistics efficiency and the calculation, assessment and mitigation of environmental impacts. The project will not only provide the ability to measure and understand the CO2 footprint across the entire service chain, but also to actually reduce it.

Admiral’s other project partner in Lithuania, UAB cargoGO Logistics, will provide the project with data and expertise, test solutions, optimise routes, improve driving styles and digitise processes. According to the company’s IT project manager, Lauras Pranckevičius, cargoGO is already testing a separate CO2 emissions calculation and reporting tools, which will enable it to offer customers the least polluting routes and services.

“We could offer customers the most sustainable, environmentally friendly route, with significantly lower CO2 emissions, contributing to a more sustainable future. The project would provide the logistics sector with a system that saves costs, avoids downtime and empty kilometres, and provides a sustainable service. The Admiral project as a whole will contribute to the interoperability of the different logistics chains, thus improving the communication between customer and carrier, to measure and calculate CO2 emissions, and to develop the organisations’ approach to sustainability,” comments Pranckevičius.

A total of 21 organisations from 9 EU countries are participating in the Admiral project. In addition to the Klaipėda FEZ Management Company, the Lithuanian Transport Innovation Association, UAB Cargo Sign, UAB Normalis Tech, CargoGO Group and UAB Trevio have joined the project in Lithuania. The project also includes representatives from business, academia and the public sector from Germany, Portugal, Spain, Italy, Greece, Croatia, Slovenia and Finland. Admiral is funded by the European Union.
For more information on the Admiral project, visit the European Commission’s website and follow its progress on Linkedin.

Important changes of LEZ’s Law

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From 2024, national and foreign defence companies are allowed to set up in Lithuanian Free Economic Zones. 
On May 23, 2023, Lithuanian Parliament lifted a ban on those commercial activities in Free Economic Zones (FEZ) that are related to national security and defence, as well as to manufacture, storage and sale of weapons, ammunition, and explosives. The ban was in place since 1995.
The Heads of Lithuania’s major FEZ said, some foreign investors operating in the field of defence industry, have been expressing continuous interests, and the Parliament’s decision will open ways for technological innovations and progress. 

Source: https://lnkd.in/eEbFqUPh

Lithuania maintains its top 3 position in EU for FDI jobs per capita

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The latest manufacturing sector report by Invest Lithuania states that even in the face of turbulent global markets in 2022, Lithuania continued to gather recognition for its performance in attracting FDI. Last year, Lithuania was rated 1st in the EU for FDI based on Greenfield FDI performance index, the country retained its 3rd place in Europe for FDI jobs per capita, and the Lithuanian manufacturing sector demonstrated overall resilience and adaptability. Also, almost 70% of companies operating in Lithuania plan to introduce new manufacturing functions or significantly expand existing ones.

Over the past several years, the manufacturing industry experienced multiple shocks, from the Covid-19 pandemic forcing manufacturing plants to suspend operations, to semiconductor shortages that led to certain industry disruptions, to lastly having to adapt to the sharply increased energy prices in continental Europe in the wake of the Russian invasion of Ukraine in February 2022. These shocks had a profound impact on FDI, the survey states.

Lithuania however has managed to maintain a steady third place across all EU members in terms of new jobs created per 1M inhabitants throughout both the pre-pandemic and postpandemic periods, only being surpassed by Slovakia and Hungary. Interestingly, in the midst of the Covid-19 pandemic in 2020, Lithuania created the most jobs per 1M inhabitants in the entire EU (600 FTEs).

Also, Lithuania was the 3rd in Europe in terms of CAPEX investments, experiencing an average 22% increase during pre-pandemic and post-pandemic periods. Lithuania’s CAPEX investments per project increased by 124%, much faster than both in the EU and the CEE. One potential explanation for the decreasing number of workers and increasing capital expenditure investments could be that in the post-pandemic period companies are keener to invest in automatization, resulting in more capital-intensive projects with lower employee requirements.

The Invest Lithuania report also surveyed 62 foreign manufacturing companies operating in Lithuania from a variety of sectors. The survey saw continued evidence of the positive trend of companies pursuing expansion projects. Almost 68% of the companies surveyed are planning to introduce new functions or significantly expand existing ones in 2023-2024, with 66% planning to expand production, 13% engineering, and another 10% R&D functions. Despite concerns over the global economic situation and geopolitics, 23% of the companies are planning to expand two or more of their functions in Lithuania in the following year.

To support this growth, respondents indicated that they are, on average, expecting to hire 46 FTEs within 2023. Again, it’s an increase on the previous year, when companies indicated plans to hire 32 FTEs, on average. During 2023, 77% of the companies are planning to hire new employees. More than a third of the respondents are planning to hire at least 30 FTEs, with eight companies planning to increase their workforce by more than 100 FTEs over the following year.

Lithuania’s talent pool has displayed remarkable adaptability and resilience against such a tumultuous backdrop. In 2022, Lithuania placed third in CEE for attracting and retaining talent. The survey findings also show that voluntary attrition rates at foreign companies remained rather stable at 19%, displaying only a 1% increase compared to the year before. Meanwhile, the overall attrition rate in Lithuania remained at around 30%. This is unsurprising as foreign companies operating in Lithuania have a successful track record of attracting and retaining great talent.

The survey results show that cooperation between foreign investors and local educational institutions remains high, with approximately half of the companies surveyed reporting that they worked together with universities/colleges and/or vocational schools on a regular basis. Not only that, the majority of these companies (67%) chose to cooperate with more than one institution. 

Although cooperation with educational institutions is common in Lithuania, not all foreign companies choose to go down this route. For the majority of those who do not cooperate (40%), the reasoning is quite simple – they do not require it. For others, the rationale is more complex – some companies lack the information needed to take advantage of such partnerships, or it may be that there are no suitable educational institutions to collaborate with.

Regardless of whether a company cooperates with an educational institution or not, the main method of upskilling people was found to be internal training. A staggering 82% of surveyed companies chose to educate people within the organization and are planning to continue doing so in 2023. In general, the survey findings show that 92% of manufacturing companies have some type of employee training. This is not surprising, especially considering that, with the rise of manufacturing 4.0, the workforce is facing an increasing need to strengthen their digital and technical skills.

Klaipėda is listed in the Invest Lithuania study as a city with key competencies in port engineering, metals, plastics and the food industry. Last year, the port city employed almost 29,000 people in manufacturing – a larger proportion than in Kaunas or Vilnius. Unemployment in Klaipėda was 5.9% last year, slightly higher than in Kaunas or Vilnius, but lower than in the other main cities of the country. Also, almost 11,000 students started their studies in Klaipėda at the start of the school year in 2022.
The Invest Lithuania survey also explored areas such as supply chain disruptions and companies’ response, diversity and inclusion, hiring times, non-salary benefits, energy sustainability, CSR and real estate. 

Manufacturing Sector Report 2023
© LAFEZ visos teisės saugomos 2021