Armsman Strnad’s balance sheet: In five years, the ministry sent him 14 billion

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Over 14 billion crowns. That’s how much the Czechoslovak Group (CSG), whose sole owner is billionaire Michal Strnad, collected from the Ministry of Defense for supplies of military equipment, spare parts, service and other services.

The most money flows to him from the production of the Tatra car factory in Kopřivnica, where, for example, Pandur vehicles are assembled on the basis of a license. This follows from the data that the Ministry of Defense, managed by Jana Černochová (ODS), provided to Seznam Zprávám upon request in accordance with the Information Act.

The editors wanted an overview of how the three largest arms manufacturers and the companies owned by them made money from the Czech army in recent years.

In addition to Strnad’s CSG, there are also the Colt CZ Group controlled by René Holeček, which focuses on small arms, and the STV Group owned by Martin Drda, whose domain is large-caliber ammunition from Poličské strojíren.

The numbers show that despite CSG’s continued dominance, the gap has narrowed in recent times. Last year, Strnad collected over two billion crowns for the supply of goods and services for the Czech army, and Holeček and Drda around 1.2 billion (a detailed breakdown by item is at the end of this text).

CSG spokesman Andrej Čírtek said about the above-mentioned numbers that they correspond to the fact that their group supplies the Czech army in particular with special ground equipment, which is a “significantly more expensive category of equipment than the handguns supplied by the Colt group.”

“For example, these are Pandur or TITUS armored connecting vehicles, where a large part of the price is made up of sophisticated electronic equipment, including from foreign suppliers,” Andrej Čírtek also stated.

Although these are billions of crowns, compared to, for example, the Swedish CV90 infantry fighting vehicles ordered last year for roughly 60 billion crowns or the American F-35 fighter jets for 150 billion, these are far from the largest army contracts.

But it should also be added that the aforementioned statistics provided by the Ministry do not include cases where CSG is “hidden” in the position of a subcontractor, which is a very common phenomenon, even with technology of foreign provenance.

Today, a significant part of what moves on wheels in the field is delivered (or will be delivered) to the Czech army on the chassis of Strnad’s Tatra trucks: MADR 3D radars, VERA-NG passive radars, CEASAR howitzers, SHORAD air defense systems, jammers STARKOM

These are also workshop, tank and rescue vehicles, where suppliers other than the CSG group are formally involved, but they also use Tatra chassis.

If the subcontracts were included in the figures mentioned in the introduction, CSG’s lead over other Czech arms manufacturers would be even greater.

And it is this trend that raises the question in army circles about how important and beneficial it is for the Czech army to use unification of chassis, when in the extreme it can lead to an unfortunate dependence on a single supplier.

The current Chief of the General Staff Karel Řehka also spoke about two sides of the same coin last year. On the one hand, he highlighted the high quality of Tatra chassis and the advantages of a unified chassis platform from the point of view of army logistics, but on the other hand, he spoke about the need to “balance”.

“Yes, if we are too dependent on one supplier, it generally always puts us at a certain disadvantage,” Řehka said on the ČT Reporters program.

The CSG group itself emphatically rejects some claims that the army has already become dependent on Strnad.

“We see it as part of a competitive battle, which is not actually conducted by Czech manufacturing companies, but by foreign suppliers,” concludes the group’s spokesperson Andrej Čírtek, while claiming that Tatrovkas are the best heavy off-road chassis in the world.

According to Čírtek, in countries the size of the Czech Republic, one type of weaponry is always produced by a single company. “Decreasing dependence on the Czech supplier actually only means opening the door for a company from abroad, which harms both the Czech economy and the legitimate interest of the state to have security of supplies from a domestic manufacturer in a crisis,” added the CSG spokesperson.

Related to all of this is the question of the degree of support for the domestic industry, which often happens in such a way that contracts are awarded without competition.

The list of reports last year already described cases where the Ministry of Defense ordered equipment “exceptionally from the law”. During seven years, 20 large contracts (over one billion CZK) for 140 billion crowns were concluded without a tender. Domestic producers participated in them either directly or indirectly.

For example, the previous minister of defense for the ANO movement, Lubomír Metnar, in his own words, supports “maximum involvement of the domestic defense industry”, as he sees it as part of building and strengthening the country’s defense capabilities.

According to him, the domestic industry plays a key role right now, when within the framework of the alliance obligations, the priority task is to build a heavy brigade and also ensure logistics. As Metnar told Seznam Zprávy, when the air forces are modernized, the composition of key suppliers will change again.

Whether to give priority to a domestic manufacturer over an established foreign one, the opposition is debating with the coalition even at this time, when the Department of Defense is deciding on the purchase of wheeled armored vehicles for the engineer army. On the one hand, the proven Australian Bushmaster vehicles are in play, while the domestic alternative can be, for example, the already mentioned TITUS vehicle from CSG in an engineering version (with a Tatra chassis).

For example, military analyst Otakar Foltýn generally sees nothing wrong with the state giving preference to domestic suppliers in the field of security. He says that he does not mind direct assignment of the contract, especially in the case of an “urgent operational need”.

However, he considers it essential that, already during market research, the Department of Defense always makes sure that it is buying at an “honest” price that is not higher than that offered by foreign competitors.

“When a Czech supplier’s exposure to foreign competition is completely disrupted, the state can pay heavily for it,” emphasizes Otakar Foltýn.

Here are the statistics mentioned in the introduction about the deliveries of Czech armorers detailed: