A whopping rise in investments in manufacturing in 2023, with an emphasis on expansion of existing production facilities, transpires from the ranking by Capital Weekly of the 15 biggest projects in the country announced last year. After 2022 saw a dip in overall investment to BGN 700 million, there was a tremendous increase during 2023, to the mind-blowing BGN 4.4 billion (approx. EUR 2.2 billion). Half of this sum relates to a three-stage project for production of batteries for electric vehicles (EVs) announced by Belgium's ABEE. Even without this project, however, the investment in the remaining projects unveiled in 2023 is three times higher than the previous year. Half of the announced projects are worth over BGN 100 million each, whereas in the previous two years there were barely three projects of similar value.
Some of the trends in the manufacturing sector were carried over from 2022 into 2023. Most of the investment projects are for expansion or modernization of production facilities of already established companies, whereas new entrants are just three. Besides ABEE, which plans three separate production facilities and an R&D center in three different locations, the other debutants are Austria's Gebauer & Griller Group in the automotive industry and International Armored Group, which will be producing armored vehicles.
Bulgarian investors remain a minority, with only a third of all projects on the list belonging to local companies. German manufacturing companies maintain strong presence with four announced projects.
One of the cities that promise to become an investment hub for the industrial sector in coming years is Stara Zagora. It is no coincidence that the city in southern Bulgaria was selected as the main location for ABEE's battery gigafactory. A driving force behind this choice are European funds targeting economic development of coal mining regions away from coal. A large chunk of this funding in Bulgaria is going towards Maritza-East coal mining and energy complex located in Stara Zagora Region.
This is Part I of Capital Weekly's list, which will focus on the investment projects in southern Bulgaria announced in 2023.
1. Battery gigafactory
Sector: Automotive industry Company: ABEEBelgium's Avesta Battery & Energy Engineering (ABEE) plans to develop a new generation production facility for solid-state lithium-ion batteries for the automotive industry with an investment of 1.1 billion euro. The project will be developed in three different locations - a production facility in Stara Zagora, an R&D center in Plovdiv and a recycling plant for used batteries in Burgas, which will also provide raw materials. If all goes according to plan, the project should be up and running in three to five years. It is still in an early stage, however, and there are a lot of unanswered questions, particularly in relation to ABEE itself, which is a relatively new and small company with limited capital. Not so long ago ABEE announced a similar project in Romania
2. Copper
Sector: Metallurgy Company: AurubisTwo investment projects were announced by the biggest company by revenue in the country - Aurubis Bulgaria, which is part of German non-ferrous metals producer Aurubis Group. One of them will focus on the expansion of the copper cathode tankhouse at the Pirdop site in western Bulgaria with an investment of 120 million euro, which will increase copper output by 50% to 340,000 tons per year. This project is expected to be commissioned in 2026, when the second project worth 46 million euro is also expected to be completed. The second project will focus on improving the slag processing process, with cooling of slag to be no longer done in pits, but in 200 specialized pots. The change will allow the extraction of an additional 500 tons of copper annually that are now residue in the slag.
3. Raw materials for bigger output
Sector: Woodworking Company: KastamonuThe Turkish producer of particle boards plans to invest BGN 150 million in a plant in the village of Gorno Sahrane. The project consists of two parts, the first of which is focused on the construction of a plant for formalin, a raw material for production of resins used to bind wooden particles into boards. This will allow for an increase of resin production capacity from 43,800 tons to 80,000 tons per year.
4. Smart and green
Sector: Automation Company: Schneider Electric BulgariaSchneider Electric Bulgaria, part of French energy management and automation group Schneider Electric, will invest BGN 107 million in yet another expansion of its smart factory for circuit breakers near Plovdiv, the government said in mid-December. The project that will feature renewable energy solutions will create 105 new jobs. The new investment comes shortly after the company finished a BGN 60 million project for expansion of production facilities and the first of its kind in the region geothermal installation for industrial heating.
5. Aluminum profiles
Sector: Metallurgy Company: ProfilinkBased near the city of Plovdiv, Bulgarian company Profilink, which is famous for its PVC profiles, is investing BGN 70 million in the construction of a new plant that will expand its product range and capacity for productiion of aluminum profiles. The new plant will be developed in several stages and is expected to start operations some time in 2024 with a capacity of 10,000 tons of aluminum profiles per year. The plant will spread on 29,000 sq. m. within a land plot of 185,000 sq. m., which Profilink has acquired in the area.
6. More complex solutions
Sector: Automation Company: Festo ProductionBulgarian automation components manufacturer Festo Production, part of Germany's Festo, began the final stageof its expansion on the land plot available to it in Sofia with an investment of 15 million euro. Due to a lack of space the company will move part of production operations to a Festo plant in Turkey. The Bulgarian facility will focus on more complex products such as electronics and smart solutions, for which demand is growing.
7. Armored vehicles
Sector: Defense and security Company: International armored group BGNew workplaces: 300
A brand new investment in Bulgaria comes with Anton Stefov's International Armored Group which has manufacturing plants in multiple countries. Construction of the armored vehicle plant began last year in Burgas industrial park. Production will include infantry transport vehicle Rila 8x8. Investment was valued at BGN 20.8 million at the time. An additional investment of 50 million levs is planned for the near future for two more plants, in Plovdiv and Blagoevgrad.
A whopping rise in investments in manufacturing in 2023, with an emphasis on expansion of existing production facilities, transpires from the ranking by Capital Weekly of the 15 biggest projects in the country announced last year. After 2022 saw a dip in overall investment to BGN 700 million, there was a tremendous increase during 2023, to the mind-blowing BGN 4.4 billion (approx. EUR 2.2 billion). Half of this sum relates to a three-stage project for production of batteries for electric vehicles (EVs) announced by Belgium's ABEE. Even without this project, however, the investment in the remaining projects unveiled in 2023 is three times higher than the previous year. Half of the announced projects are worth over BGN 100 million each, whereas in the previous two years there were barely three projects of similar value.
Some of the trends in the manufacturing sector were carried over from 2022 into 2023. Most of the investment projects are for expansion or modernization of production facilities of already established companies, whereas new entrants are just three. Besides ABEE, which plans three separate production facilities and an R&D center in three different locations, the other debutants are Austria's Gebauer & Griller Group in the automotive industry and International Armored Group, which will be producing armored vehicles.
