Japanese group Sumitomo will invest in an auto components factory in the city of Drobeta Turnu Severin, in Southwestern Romania, where it will have 500 employees starting August this year. The factory, which will produce parts for Volkswagen cars, should reach 2,000 employees in the next two years, according to Agerpres newswire.

The group’s representatives met on Wednesday, July 2, with the Drobeta Turnu Severin mayor to agree on the final detail on this cooperation and on the workforce selection process.

“We will give Sumitomo some fiscal facilities so that the factory can absorb as many unemployed as possible. The first hiring will be made on July 21. If all goes well, in 2015-2016 there will be about 2,000 jobs created here,” said Constantin Gheorghe, the city’s mayor, quoted by Agerpres.

Drobeta Turnu Severin is situated in Mehedinti county, which is one of the poorest counties in Romania. Mehedinti has the second highest unemployment rate in Romania, of about 11 percent.

According to Sumitomo representatives, the factory will be opened in a building belonging to the former paper factory Celrom. The new employees will undergo a two-week training in Caransebes, where the Japanese already have a production line. The new factory will start production on August 18.

Sumitomo produces electrical wiring for the auto industry in Romania, through its Sumitomo Electric Wiring Systems (SEWS) company. In 2013, the company had EUR 215 million in sales and EUR 9.7 million net profit. It had more than 7,250 employees in factories located in Deva, Orastie, Alba Iulia and Caransebes.

Sumitomo also owns agriculture chemicals distributor Alcedo, which had EUR 112 million sales and EUR 5.85 million net profit in 2013.

Sumitomo is the third largest Japanese corporation and its businesses span from heavy industry, chemical industry, financial services, mining, electric and electronics industry, construction, real-estate, auto and IT. Among other, Sumitomo controls carmaker Mazda, tire producer Dunlop, electronics producer NEC and Sumitomo Mitsui financial group, one of the largest in Japan.

editor@romania-insider.com