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Gorenje Taking on Markets Outside Europe with Premium Products

Ljubljana, 10 September (STA) - CEO of household appliance maker Gorenje Franjo Bobinac talked to the Monday edition of the daily Delo about the company's plans, including the relocation of washing and drying machine plant from Sweden to the company's base in Velenje. Gorenje is also working on penetrating markets outside Europe with premium products.

Bobinac told the paper that some 450 people will lose their jobs in Sweden, 50 will remain employed. "Of course, we are sorry, but the move will protect eleven thousand of our employees," he said.

Gorenje operates plants in Slovenia, the Czech Republic and Serbia. Seven years ago, it manufactured most of its products in Slovenia, today only some 55% of the household appliances are manufactured here, according to Bobinac.

The washer and drier manufacturing plant will be relocated to Slovenia, although the labour cost in Serbia is three times lower than in Slovenia, because Gorenje is already producing washers and driers in Velenje, the CEO said.

The household appliance maker is planning a fast penetration into non-European markets, building the strategy on premium brands and products.

In markets like Dubai, Shanghai, Hong Kong, Georgia, Israel, Taiwan and Brazil the company only offers the highest-value products, Bobinac told the paper.

The company plans to reach EUR 150m in revenue outside Europe in 2015, but Bobinac is even more optimistic, he believes they can reach EUR 200m.

He noted that Gorenje was getting ready for the potential end of the euro, although he personally believes the common currency will survive the crisis. He believes that the eurozone is facing two major issues: unequal production capacities of national economies and the lack of a fiscal union.

Bobinac moreover said that Slovenian finances and economy are not in a such a problematic condition, "as the state of mind and of the value system".

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