FSO History

INCEPTION OF FABRYKA SAMOCHODÓW OSOBOWYCH

After the finish of II World War the government decided to rebuilt Polish automobile industry which goes back to 1919. In July 1948 the construction of Fabryka Samochodów Osobowych in Żerań began. The contacts were established with FIAT – pre-war partner. The license agreement was signed. Żerań was supposed to produce the modified FIAT 508 model and next 1100. The construction works began. Unfortunately in 1949 due to the political situation – so called “cold war” period – agreement with FIAT was terminated. The government decided to continue the construction of the plant. USSR became a new partner.

 

 

In January 1959 the Polish-Russian license agreement was signed to produce M-20 Pobieda In the framework of which the Russian party guaranteed the assistance at the design stage, construction, equipment and launching the series production. Fabryka Samochodów Osobowych bought a license from the Car Manufacturing Plant in Gorki. The vehicle which was supposed to be launched in Żerań was not originally a Russian design. Its prototype was Ford of 1927. After the construction of FSO finished, the production capacity was estimated at the level of 25 thousand units annually. The official “birthday” of FSO is the 6th of November 1961. It was the day when the first car of the post-war Poland was produced. It was called Warszawa M-20. It’s also a historical date for the whole automobile business. From that point in time the series and industrial production of passenger cars in Poland began.

 

M - 20 WARSZAWA

The then Polish authorities considered FSO as the self-sufficient plant with two-shift operation which could produce everything – pads, bolts, nuts for main subassemblies and ready vehicles. The first units of Warszawa were assembled out of components delivered from the Soviet Union. After five years from the start of production in 1956 all elements of this car originated in FSO.

Warszawa M-20 was produced up to 1964. Then the upper-valve 223 and 224 with sedan body and its prototype: combi, pick-up and ambulance. In the period 1951 – 1973 that is from the moment of FSO establishment till the production of Warszawa was terminated, around 10 versions of this car were created. In M-20 around 4 thousand design changes were introduced and engineers of FSO were their authors. Also studio models were produced, among others Warszawa 210. The last Warszawa having the number 254421, was produced on the 30th of March 1973.

 

 

SYRENA

The first entirely Polish passenger car created in FSO was Syrena. Its prototype prepared as a small cylinder car was ready in December 1953. The model of Syrena 101, presented at the Poznań Trade Fairs in 1955 was acknowledged among Polish drivers. The authorities took the decision (1957) about the start of the mass production. There were many opinions that the word “production” was not appropriate for each unit was a masterpiece: the body was modeled manually and welded with the acetylene torch. The mass production of this car began only in 1961 when the real conditions were created and it was possible to produce over 5 thousand units annually.

 

The following years brought about the next models of Syrena - from 102 up to 105 and the agricultural version of this car - Syrena R20. Syrena underwent totally over 800 modernization changes.

We also created several studio models of this vehicle. In 1960 we presented the prototype of Syrena Sport with the body made of plastic.

In 1964 the next studio model was produced of the first in the world combi-limousuine – Syrena 110. According to experts, this vehicle with little stylistic changes could be judged modern today. In 1972 the production process of Syrena was moved to Small Engine Vehicle Plant in Bielsko Biała.

 

POLISH FIAT

In 1965 a new stage in FSO and Polish car business’ development started. The license agrement is signed with the Italian concern FIAT to produce 125p model. 2 years later the first Fiat 125p was produced in the newly built Żerań plant. The car was constantly and systematically modernized, almost 4 thousand design changes were introduced in its respect. The agreement guaranteed the application of units and parts of 125p to produce different versions of this vehicle and other vehicles in Poland.

Polski Fiat 125p was for FSO the basis to design and start the production of their own models: combi, ambulance, taxi, racing cars, travel cars – extended in the closed and open version, pick up.

In 1977 in the FSO Experimental Shop the sport version of Fiat 125p was created. It received the name Ogar and its prototype version was made of plastic. According to experts’ opinion, it was one of the most mature design of FSO engineers. Unfortunately, due to financial reasons, the production was not launched.

On the basis of imported subassemblies, so called standards, in the 70s FSO produced also Polish versions of Fiat Fiata 127,128, 131, 132 and Ritmo as well as Yugoslav Zastava 1100.
Polski Fiat 125p, which changed its commercial name twice - first FSO 1500, then FSO 125p – was produced up to 1991. The last unit produced on the 29th of June 1991 had the number - 1445699.

 

 

POLONEZ

The next stage of the factory’s development was launching POLONEZ production in 1978. Żerań designers with the support of FIAT experts prepared the design assumptions of the new model and the technology of its production. The principle was adopted to take into account the current global tendencies for the design of the medium-class vehicles.

Numerous solutions were introduced to assure a new attractive body shape and modern then hatchback model – new silhouette of more streamlined shape in comparison to FSO 125p, considerable decrease of air resistance. Different shape of the rear part of the body and the assembly – starting from 1981 – of unfolded seats enabled passengers to increase their luggage in Polonez.

Designers of Polonez paid special attention to providing maximum safety while driving, both active and passive. In this respect the passenger area was characterized with high toughness and had both rear and front areas of the controlled crush. For safety reasons the hinge of the engine room was transferred on its rear edge. Thanks to that even with the most unfavorable conditions the hood would not get inside through the glass inside.
The new car was equipped with a new engine of 1300 and 1500 ccm. It was different from FSO 125p one In the first period of production. Polonez had 4-gear box. In 1987 cars with 1600 ccm were introduced to production. They had bigger power (87 KM), were more flexible and of lower toxicity, they were also more economical. Polonez was modernized every year. Those were bigger or smaller changes but all of them influenced the passenger’s comfort and car’s functioning.

 

POLONEZ "CARO"

 

 

The main changes were introduced by designers in caro model chich appeared on Polish Road in summer 1991. many design and technological solutions were introduced. The reason was first of all increase the maintenance features, the comfort of driving and the outer appearance of the body. Caro became completely new car. It had hood, fenders (front and rear) changed, more sileni exhaust system (three-segment like – three-muffler one), different head lamps, new steering wheel, parted rear seats, moveable point for fastening the seat belts, wheel rims made of aluminum, plastic bumpers. Changes introduced in Caro enabled the adjustment of the interior and silhouette to fashion of that time in the car industry; adaptation of Polonez to loudness standards in Poland and abroad; reducing the weigh of the car (maliny thanks to New bumpers), increasing its features – head lamps providing Belter lighting, moveable point for fastening of seat belts ect.

The continuous modernization of Polonez became one of the prior goals of FSO. Further years brought next significant changes. The most important included: introducing greater distance of wheels improving the road features and car’s stability, introducing Polonez with 1,4 Rover engine to the series production, implementing electronic equipment significantly improving the reliability of the electrical installation and fire protection of the car; new seats; modernized, efficient ventilation system. Many changes affected the outer appearance and functionality of the interior. The dash board was modernized by introducing the new set of indicators, the switch for the regulation of head lamps’ position from the steering wheel was designed. Very well known fuel engines – 1500 and 1600 as well as fuel with one-point electronic fuel injection designed by General Motors, controlled by ECM and Citroen diesel engine – were adjusted to have the triple-action catalyst installed.

FSO client could then buy Polonez with the optional equipment. It included: wheels of the light alloy, sport-type seats with Inter-Groclin head Rest, auto alarm, central blockades of door lock, electrical mechanism for lifting and lowering glass in the front door, sunroof, radio players, loudspeakers, metallic body paints.

 

FSO is not only Żerań plant

Expanding the production of the Polish Fiat, launching its further versions and models and starting Polonez production brought about the necessity to broaden FSO structure. Since 1966 successively subsidiaries were included in the plant.

The first among them was Automobile parts production Plant from Opole. In the 70s it was joined by:

• Clutch Plant in Kożuchów,
• Automobile Upholstery Plan in Grójec,
• Subassembly Production Plant in Siedlce,
• Automobile Fittings Plant in Elbląg
• Driver Units Plant in Wyszków,
• Chassis Units Production Plant in Warsaw,
• Automobile Springs Plant in Warsaw.

Whereas the Automobile Electrotechnology Plant in Ełk, Engine Subassembly Plant in Żuromin, Assembly Units Plant in Warsaw, Engine Parts Plant in Ciechanów and Delivery Cars Plant in Nysa joined FSO in the 80s.

 

 

 

Quality is the most important

The beginning of 90s and the clash with the market economy and its new principles was very hard. The management of the plant judged that only quality improvement can save FSO existence. On the 27th of November, 1992, Fabryka Samochodów Osobowych ceremoniously accepted „FSO Mission” based on the assumption that FSO must become the best Polish company regarding the quality of goods and services. FSO introduced a new system of the company’s management – MANAGEMENT THROUGH QUALITY (ZARZĄDZANIE PRZEZ JAKOŚĆ), in short TQM (Total Quality Management) and became the precursor of applying this philosophy of the company’s management. There was neither previous experience nor guiding light. That is why we established cooperation with Jurana Institute, the leading training and guiding institute regarding TQM implementation in the world. One of the elements of his management system introduced by FSO are ISO 9000 standards. ISO 9001 standard called “Model of quality assurance in production design, installation and service” was binding for the plant.

 

 

Looking for a strategic partner

In the first half of the 80s when it was clear that FSO would not be able to develop without the support of a foreign partner, it was decided to re-establish the cooperation with the Italian concern FIAT. In 1988 the higher management of the plant informed that the decision was made to buy the Italian license. The car originated from Uno family and on the working level was called A-90. Ultimately Żerań plant was supposed to produce 120 thousand cars annually. Both companies right away started to prepare the contractual documentation. In early beginning of 1988 the agreement of both plants was initialed. The same day it was terminated by the then Industry Minister of the Polish People’s Republic, Mr Mieczysław Wilczak who arbitrarily changed the concept of the development of the Polish car industry. He decided that FSO would produce Fiat Cinquecento and 126p together with Fabryka Samochodów Małolitrażowych from Bielsko – Biała.  

At that time world many automobile concerns got interested in Fabryka Samochodw Osobowych. Among them were Daihatsu and Renault.

At the end of December 1989 the then FSO director - Andrzej Śniecikowski met the representatives of General Motors higher management. Newly elected General Director of FSO - Andrzej Tyszkiewicz, right after taking the chair he resume the next stage of negotiations with GM.

At the beginning of July 1991 FSO was presented with the unexpected offer of extend the  cooperation with the Polish automobile industry by French concern Citroen. Despite the fact that American proposals were much favorable, FSO did not reject the proposal to cooperate with the French company. It brought about the contract for the supplies of 1,9 l diesel engines to be assembled In Polonez.

In February 1992 the next stage of negotiations with Americans started. On the 5 of December 1993 the Letter of Intent was signed regarding creating a joint venture of FSO and GM. It was agreed then that Żerań plant would produce 35 thousand Opel Astra cars annually. The cooperation was supposed to start having 10 thousand cars assembled. According to the schedule, the first Astra cars should be completed in July-August 1994.

In May 1994 during the International Moto Show in Poznań, the official news was presented regarding the establishment of General Motors Poland Sp. z o.o. Cooperation of GM and Żerań plant was meant to deal only with the assembly f Opel, modernization of Polonez, work on the development of the New car model, but also to influence the development of the whole Polish automobile market of producers and suppliers of components.

Unfortunately, the report presented by GM to the  Polish government in April 1995 showed that their interest in Fabryka Samochodów Osobowych narrows only to cars’ assembly  in Żerań.

 

DAEWOO – THE BEST PARTNER

FSO was offered the cooperation by another world automobile concerns. The most profitable for our company turned to be the proposal made by South Korean DAEWOO concern.

On the 16th of August 1995, the Letter of Intent was signed between the Minister for Industry and Commerce and Daewoo concern regarding the split of consortium in the privatization of Fabryka Samochodów Osobowych in Warsaw.

The Lester of Intent assumed starting the immediate negotiations timing at purchasing of at least 60 shares of FSO by Korean partners and performing the investment program up to 2001 letting to produce around 500 thousand passenger cars annually, including at least 200 thousand of the New generation vehicles. The new models were supposed to consist finally of 60-80 % of Polish components. It was a very important element making export of cars to the EU countries conditional.

Moreover, the investment plans assumed launching of the production of New engines and gear boxes – ultimately 300 thousand units a year. At the same time Polonez was to be produced continually up to 1999.

Parties agreed to finish the negotiations and to conclude the appropriate agreements and contracts up to the 31st of October 1995. On the following day after signing the document, Daewoo boss visited FSO together with the group of his employees broadening his knowledge regarding operation and specificity of many Żerań shops.

The October extraordinary session of FSO Employees’ Council opened a path to establish joint venture with the Korean partner. It took place on the 14th of November 1995. In the Ministry of Industry and Commerce the contract was signed regarding the joint venture’s establishment. The document was signed in the presence of Vice Prime Minister Grzegorz Kołodko. It was then agreed that the privatization of FSO will be carried out through the liquidation of the state-owned enterprise  , then a sole shareholder company of the State Treasury and joint venture with Daewoo.

 

SIGNING THE CONTRACT

By signing the contract, FSO was transformed into a company with the foreign capital. The Korean partner obliged itself to input USD1.5 bn during 6 years, modernization of Polonez both in the passenger and truck version, production of ‘100’ series new generation vehicles in Żerań that is Lanos, Nubira and Leganza, as well as reaching the level of 500 thousand vehicles. The Social Package signed together with the contract guaranteed keeping the employment level for the period of three years and keeping all social privileges FSO employees took advantage of.

Daewoo-FSO Motor Bard of Directors changed a lot in the up-to-then organization and strategy of the plant’s operation. Thanks to them Daewoo-FSO Motor became a very tough competition for other domestic car manufacturers. Market examinations in 1998 showed that we scored second in Poland as far as the volume of passenger cars and delivery trucks. It became possible thanks to the restructuring of the company and optimization of the management processes, but most of all – investment of the big capital in the state-of-the-art technologies.

 

 

START OF ACTIVITY

The liquidation of FSO state-owned company and the transformation into a company with 100% State Tresury share was made extremely fast – 6 weeks. The seed capital of FSO Motor established on the 29th of February 2996 amounted to USD 180mln. Two weeks after signing the  notarial deed bringing FSO Motor into life the capital was increased to USD 200 mln and at the end of 1996 amounted to almost USD 245 mln.

In the first months of the company’s operation we paid back all obligations against the State Treasury, after the former State-owned enterprise FSO. It was a considerable amount – USD 90 mln.

 

 

According to the contract 100 series models – Lanos, Nubia, Leganza would be produced in 1998 and 1999. We were ahead of the plan by over one year. Those cars appeared on the Polish market in early autumn 1997. It was a great event in the automobile world, not only on the domestic importance. It was the first time in the automobile history that one concern introduced three models, each for a different segment, at once.

However, it was not the end of premieres. During the 57th Auto Show in Frankfurt in September 1997, Daewoo showed its first child – Matiz which was introduced on the Polish market in December 1998.

 

 

 

 

 

INVESTMENT PROGRAMME

Investment layouts to launch New cars In Daewoo-FSO amounted to USD 623,9 mln up to the end of 1997 in Żerań and subsidiaries of joint venture.

According to the company’s strategy of the development the plant capacity reached the In the course of three years the New Żerań emerged.

 

 

 

 

RND

The functioning of a big, modern car company would not be possible without the broad scientific and research background. That is why FSO from the very start of its operation attaches great importance to extensive examinations and the technical and design development. Thanks to big investments, the design and examination techniques were changed drastically into the new ones, which made it possible to develop next new models.

In the design area we introduced the graphic stations operating In the network and enabling the spatial modeling of the design elements, simulating their load and functioning yet before the prototype phase.

 

 

 

GLOBAL QUALITY

The most important task ahead of Daewoo-FSO at the beginning of its operation was to increase the quality of cars themselves but also the process of their production to reach the global quality. After several weeks of Daewoo-FSO Motor inception we introduced “Program 100”. As a consequence we introduced many organizational and technical solutions which improve the quality control of vehicles in the course of the production process and after its completion, and it’s most important goal was to change the way operators think about quality. During the implementation of the program it turned out that 100 days in the slogan were not that much important as the involvement of 10% of the team to receive 100% good products

 

As part of „Program 100” a new notion was created that is „client – receiver”. Polonez cars are right now evaluated according to IQS (Initial Quality Study) principle applied not only in Korean, but also American and European car industry and based on issues not only relating to the production quality but also supply and design quality.

As a result of pro-quality policy of Daewoo-FSO Motor, not only in relation to the product itself but also to the whole production process, the Company was awarded ISO 9002 certificate handed over to Daewoo-FSO President Jin Chul Suk by the representative of TUV Rheinland on the 18th of December 1997.

In November 1998 Żerań plant was given the Polish Quality Award, as the first car manufacturer in Poland.  The same month we obtained ISO 9001.

The Polish Quality Award  - the laurel we received on the Independence Day from Polish prime Minister Jerzy Buzek was the browning achievement of activities to optimization of the quality of the production processes and management systems. It is a great success of the company and at the same time the proof that the huge financial and organizational effort taken by the Board and Żerań team brought about the expected results. Awards and certificates demonstrate that the company is fully prepared to open the European borders.

However, the effect of activities in the scope of environmental protection taken up by Daewoo-FSO is the Certificate of Environmental Management System ISO 14001 awarded In September 1999. It must be pointed out that in 1999 we started to apply for the European Quality Award granted by the European Union.

 

ENVIRONMENTAL PROTECTION

 

According to the ecological Policy of Daewoo-FSO, the company will look after the environmental protection, its harmonious development and heath of the society At all stages of its activity. The Company also declares to carry out transparent and open social Policy.

The most important activities taken up by Daewoo-FSO Motor include: creating the laboratory for air and water examination, the control of energy consumption, modernization of the industrial waste treatment, creating the water demineralization plant and modernization of the liquid oxygen installation. Currently, we are monitoring air pollution.

New Paint Shop meets all eco standards in place in the European Union. Technological processes and materials applied are 100% environmental friendly, among others elpo paints without heavy metals, water-borne paints and metalized solvents.

In September 1999 Daewoo-FSO Motor was granted ISO 14001 Environmental management System Certificate.
All FSO sewage are sent to our own treatment plant built on the basis of the modern technology of Gutling.

In April 2005 FSO was granted Environmental Management System Certificate ISO 14001^1996 which is the browning achievement of FSO activity In terms of environmental protection.

Thanks to recent multimillion pro-ecological investments the Plant can function next to big housing estates such as Bródno, Targówek or Tarchomin. Several days later – 27th of April during the conference devoted to the 15-th anniversary of the Polish program for cleaner production, the Plant was distinguished with the next diploma for introducing cleaner production as a strategy of the environmental management system.

Among laureates in the small land medium-size enterprises were our subsidiaries: Koram, Zomis, Towarowa 33 Corporation. However, Zomis was awarded the title of the clean production leader of 2004.

 

WE GO BACK TO THE NAME WITH TRADITION

From the moment our Korean partner went bankrupt, the fight to keep the company going started. Thanks to the determination of the management Board to keep the production and avoid bankruptcy as well as the great effort of the team who carried the burden of the critical situation of the company, the situation became stable. We started tough negotiations to extend the right to produce Lanos and Matiz, which ended successfully on the 22nd of April, 2004. Daewoo-FSO Motor was given the right to produce cars, sell them on specific markets (including export) and to produce parts and conduct sales 7 years after the finish of the production of those models.
On the 31st of August 2004 during the Extraordinary Shareholders Meeting it was decided that the Company will return to its traditional name: "Fabryka Samochodów Osobowych Spółka Akcyjna". Models produced changed their names into Lanos FSO and Matiz FSO, and the hoods received a trademark with the shape of a steering wheel which is the symbol of the tradition of the Polish car industry and over 50 years of the development of our car industry after the war.

At the same time with respect to the difficult situation on the Polish car market due to soaring import of second-hand cars from Western Europe, we started to look for New sales markets for the produced models.

Since the 11th of October 2005, the majority shareholding of FSO S.A. belongs to the Ukrainian concern CJSC ZAZ. Negotiations with GM were also initiated and brought about signing the contract for the production of T-250 and T-255 models in 2007.
On the 11th of November 2007, that is on the 56th anniversary of starting FSO, the first Chevrolet Aveo in the European Union was produced on the technology line A. In summer 2008 4-door notchback was accompanied by 5-door hatchback, and in winter 2008 the company produced hatchbacks in 3-door version.

Mr Janusz Woźniak, FSO President and CEO said: „Starting the production of Chevrolet Aveo is the beginning of a new era in the Plant. We are proud to have experienced, reliable experts. Thanks to the very popular product of the global leading branch, installation of New machinery and equipment In the Plant and benefits from thousands of training hours, we are sure that we will be able to meet the requirements of European customers of Chevrolet.

Chevrolet can boast itself with the long tradition of car manufacturing In Poland. The first models were produced in the Shop at Wolska street in Warsaw as early as in 1928, and the second shop started its operation in 1937 in Wola suburbs. In those days Polish operators were trained in General Motors International A/S in Copenhagen. Among 4-door models of Chevrolet produced in Wola included Master Sedan, Master De Luxe, Master Touring Sedan and Imperial Limousine.

FSO has already produced over 90000 of Chevrolet Aveo, the quality factors of which present the global level of production quality in the automotive industry. level of 225 thousand cars annually. To achieve this task, we speeded up by 1 year. Thanks to the investment layouts we increased the production capacities of each shop. The substantial part was spent on the reconstruction of the existing industrial premises as well building the new ones. Thanks to this Żerań plant immediately transformed into the modern car factory, and was equal to plants considered the best In his sector In the Word. We built the new Assembly Shop and paint Shop from scratch. We modernized Press Shop and Body Shop.