Karel Magušin works at Automotive Painting Partners as Business Development Manager for Central and Eastern Europe. In this interview, he openly shares how the requirements of OEMs and Tier suppliers are changing, how APP responds to pressure from cheaper competitors in Eastern Europe, why trade fairs remain indispensable even in the digital age – and where the company is heading over the next five years.
You work at Automotive Painting Partners as a Business Development Manager. What does your role mainly involve?
Simply put, my responsibility is to ensure that our plants have work to do. This includes communication with existing customers, evaluating enquiries, and preparing and processing quotations. In addition, I actively seek out new business opportunities. As APP is part of Colegium Holding, I also represent other group companies during negotiations. Our portfolio is broad and we offer comprehensive services, which is a major advantage not only for customers but also for the companies involved.
Automotive Painting Partners is one of the key suppliers of cathodic dip coating (KTL) in Central Europe. How would you describe APP’s current international business relationships within Europe?
Our priority is truly understanding the customer’s needs and expectations in every respect. Business relationships are always complex, especially in international cooperation. As a supplier, we therefore focus not only on a professional approach but also on the personal dimension of relationships. Building trust, open communication and long-term partnerships are key for us.
APP is not just a “KTL supplier” but a strategic partner for complete part manufacturing. How is this role perceived by your international customers?
Very positively. Most customers appreciate our comprehensiveness – we are able to offer a complete process, from material sourcing through surface treatment and assembly to final delivery. This makes us a true strategic partner that supports their competitiveness.
You have succeeded in maintaining long-term partnerships with leading global automotive manufacturers. Where do you see the greatest market opportunities in surface treatment in Central and Eastern Europe?
Trends in both automotive and mechanical engineering indicate stable growth in demand for cathodic dip coating. This is driven by a focus on sustainability, high corrosion resistance and the efficiency of KTL processes. The transition to electric and hybrid vehicles increases requirements for corrosion protection, especially for battery housings, chassis components and structural parts. By 2030, electric vehicles are expected to account for up to 40–50% of production in the Czech Republic, which will directly increase the volume of KTL projects.
What trends do you observe in demand from OEMs and Tier suppliers?
In surface treatment, technical requirements are usually clearly defined by corrosion resistance. The main differences lie in expectations: OEMs and Tier suppliers are all pushing for electrification, sustainability, cost efficiency and innovation. At the same time, they face slower growth in electric vehicle production, geopolitical risks and supply chain pressures. OEMs want new technologies at lower cost and expect suppliers to optimize expenses while maintaining high quality. Suppliers respond strategically by optimizing their portfolios and building long-term partnerships to remain flexible in an increasingly demanding market.
How do you perceive the position of Czech engineering and surface treatment suppliers in Germany? Do you still encounter quality-related prejudices?
Today, Czech engineering is perceived in Germany as a standard, reliable choice – especially thanks to long-term cooperation in the automotive and mechanical engineering sectors. Quality-related prejudices have largely disappeared. The focus is now more on delivery reliability, certifications such as ISO and IATF, and process transparency rather than the country of origin.
German companies still view Czech suppliers as cost-effective, but they increasingly expect a higher level of innovation, automation and technological maturity. The “low-cost workshop” model is gradually losing relevance. OEMs and Tier suppliers are looking for partners with higher added value, flexibility and the ability to respond quickly to new technological trends.
Do KTL suppliers from Eastern Europe, often competing with significantly lower prices, pose a threat to Czech companies?
Yes, price competition from the East is a threat. Suppliers from Poland, Romania or Ukraine often offer prices 20 to 40 percent lower than Czech companies, which is naturally attractive to OEMs and Tier suppliers under cost pressure. Low price is their main competitive advantage – often at the expense of service quality, delivery speed or flexibility.
And does this price pressure pose a threat to APP as well?
Fortunately, no – but fortune favours the prepared. For us, it does not represent a fundamental threat because we offer strong arguments: quality, a comprehensive service package, certifications, flexibility and geographical proximity. Customers receive services “under one roof.” Thanks to digitalized processes, a strong focus on sustainability and the ability to handle non-standard requirements, we also provide a high level of reliability and technical support.
APP’s strong position is further supported by its long-standing reputation and the ability to combine KTL with other manufacturing operations such as stamping, welding and assembly. The strategic location of our plants in the Czech Republic enables fast response times and stable deliveries, which are crucial in the automotive industry. In contrast, Eastern suppliers often face longer lead times and higher logistical risks – a significant disadvantage in a just-in-time environment.
Are international trade fairs still as important today as they were in the past, given online communication and digitalization?
Absolutely. Personal meetings remain essential for building long-term relationships. Trade fairs allow technologies to be seen live, technical details to be discussed and complex projects to be addressed. Not only buyers attend, but also engineers, project managers and company management, which creates space for strategic partnerships and new customer acquisition.
Digitalization has not replaced trade fairs – quite the opposite. They remain the ideal platform for presenting new technologies, equipment and processes. For complex solutions such as surface treatment or automation, live demonstrations have a far stronger impact.
APP has a strong position in automotive. Do you see potential for KTL and welding in other industries?
Definitely. KTL is applicable wherever materials must withstand demanding climatic conditions and degradation needs to be slowed. Welding is widely used in serial structural components and automation.
I see the greatest potential in construction and infrastructure, agricultural and construction machinery, energy and renewable sources, aerospace and rail transport, as well as consumer industries.
Are investments in advanced automation and digitalization a necessity today, or still a bonus?
Investments in AI, IIoT, robotics and innovative technologies are no longer a bonus – they are a strategic necessity. We see this directly in practice. Automation and robotization of our welding lines bring lower unit costs, higher precision, repeatability and faster responses to changes in demand. Without these investments, we would lose competitiveness and the ability to meet growing customer requirements.
How do you perceive the current role of environmental responsibility in business negotiations?
ESG compliance is becoming an increasingly important part of business strategies. In strategic projects, environmentally responsible approaches and low energy consumption are often part of the evaluation criteria, sometimes carrying a weight of 20 to 30 percent. I expect that within three to five years, insufficient ESG performance will mean losing access to major OEM contracts. It is no longer a formal obligation, but a real factor in partner selection.
What is APP’s vision for the next five years? Are you considering expansion beyond Europe?
APP’s vision must primarily reflect technological trends, customer requirements and global market dynamics, with a strong focus on automation and digitalization. Continuing to offer comprehensive services is a given.
APP and Colegium Holding as a whole have the potential to become a technological leader in ecological and digitalized surface treatments, welding, testing, strain gauging and other fields, while also diversifying beyond automotive and gradually expanding into global markets. Expansion beyond Europe is not easy, but joint ventures with local partners or exporting know-how and technologies may be the right path. The potential is certainly there.
Thank you for the interview.
