This location is fantastic
Interview with Heinz Lichtenegger, CEO of Audiotuning and President of Project Audio
There are only a few global market leaders in Austria. Heinz Lichtenegger is one of those. Twenty years ago he saw that there would still be a market for vinyl. Today he manufactures 120,000 record players per year in 3 manufacturing facilities in the Czech Republic. There is hardly any good HiFi store in the world, which does not sell his products, and artists like Parov Stelar or Jack White often seek cooperative efforts with him. He is building his headquarters for export to 80 countries at the Business Park A5 and is trying to put another idea for the future on track with the most varied product portfolio including different components for high-class micro HiFi systems.
Why did you choose the location Business Park A5? Why here and not for example in the south of Vienna, the traditional industrial location?
As a business location, Mistelbach is fantastic. In London or in Paris, one would state London or Paris as the address even if located 35 min. from the city centre. We are on the outskirts of Brno and Prague and are connected to the Westautobahn motorway by the Nordautobahn motorway and the S1 motorway. Such a perfect location with such affordable property prices doesn’t exist anywhere else in the world. I can’t understand people who are building in the south of Vienna right now.
What are the plans for the building process?
We are in the final phase of planning and already know what the building will look like. We are going to start in 2016, the logistics centre is going to be finished by the end of 2016, and in 2017 we are going to be at full work. Afterwards, there will be the expansion step with museum for the industrial tourism. In regard to the design of the building, there will be a surprise.
Which departments are you going to bring here? What is planned?
Until now, I have only had an office in Vienna, but I will now personally take over the logistics at the Business Park A5 so that I can negotiate the amount of products that I expect in the future. Marketing, manufacturing of high-class products as well as special assembling products, global technical support, a training centre and a show room are going to be here. Together with the agency Checkpoint Media, which also worked with Swarovski Kristallwelten and at the opening of Red Bull Hangar-7, we are going to develop a destination for industrial tourism. A kind of museum with analogue record players, which can be touched and played. The museum will show how a record player works and how one can assemle a system.
You were born in the Weinviertel. Which town are you from?
I lived in Zistersdorf until I was 5 years old. In a family of 6 children money was always tight. Therefore, starting when I was 10, I worked at my mother’s gas station and delivered the Konenenzeitung newspaper on weekends. Soon people knew that I knew a lot about HiFi. I financed my studies by selling the systems, moved to Vienna after military service and opened my first store in a substandard location on 50 sqm. My idea was to sell people products, to sell as well as possible and with as little components as possible. I started selling more and more HiFi systems in Vienna and the Weinviertel and soon after, I was considered as one of the ten biggest retailers in Austria.
Was the available labour force in the region an argument for you for Business Park A5?
Yes, already 70 to 80 percent of my employees, some of whom have already been working for me for 25 to 30 years, are from the Weinviertel. People here are performance orientated and responsible. They are OK with a fair starting salary and with pay raises later on.
Years ago you saw the future in record players and CDs that they would become discontinued. Why?
In the ‘80s, the industry thought that a CD would be much better than a vinyl record. The funny thing was, if one listened, it was obvious that CDs aren’t as good as records. The market was overstocked by CDs, the record player industry went bankrupt and I had a problem: No longer could I offer my customers the same sound experience at a reasonable price. There were still affordable record players, but they where crap.
Where do you manufacture in the Czech Republic? Since when?
I regularly organise parties for marketing reasons. At one of those events I got to know a young lady from the Czech Republic, the daughter of the Czech ambassador. She brought a record player with her and told me that it was from her uncle in the Czech Republic and asked if I could adjust it. It looked like an ugly duckling, but everything else was high-class. On a foggy day I went to Litovel to take a look at the manufacturing plant, which was about to be shut down. At that time they tried to change to alternative products like engines for washing plants or water kettles. An idea that was doomed to fail. I bought 200 record players, modified them and sold them in a short time. I went there a second time and wanted to buy more, but the management had no other interest other than to smash the company. I came to an agreement with the middle management and the plant started to manufacture for me. I sent one of the record players to Germany for a testing. Pro-Ject 1 was immediately the best.
The demand was already there in the ‘90s. There were people who understood that vinyl sounds better. The replacement business was an important factor. Many old record players broke and the repair works were just as expensive as a new Pro-Ject.
Management was finally convinced. I found a partner who bought the plant and I provided a guarantee that I would buy everything that was manufactured. The analogue market grew and we had the big advantage that we were the first and the catalyst and we became a real brand on the global market, a global market leader. We have won several awards. Recently we won the Eisa Award in Berlin again.
How many record players do you sell per year?
At the start of 2000, we sold 30,000, but soon we sold 50,000 - 60,000 players. The boom set in successively in particular countries, in England, in Canada and in 2012 and 2013 the Americans joined in. Now it’s 120,000.
Meanwhile I’ve decided to take a big investment away from the analogue product. For years, I have been working with various developers on the idea to develop very small, affordable HiFi systems with high-end sound and manufacture them in Europe. They consist of micro-components, which can be assembled by the customers themselves. We also manufacture the smallest CD player. I assume that 30% will return to HiFi stereo in the near future.
How many people to you employ?
In Austria 25 to 30. In three plants in the Czech Republic 500 people work for me within partnerships. Not only do we manufacture record players there, but the plants produce 70,000 pieces of electronics. The more we move toward manufacturing in the electronics sector, the more it will be in Austria.
Were the cities Mistelbach and Wilfersdorf, the managers of the Business Park A5, accommodating? Were you supported?
I consider it a huge advantage to cooperate with these cities. It is possible to speak more openly, results are reached more directly, without bureaucracy. There is a maximum of attention. I’m also not afraid of those operating permits. I have the feeling that one is welcome, that there is interest in the activity.
Which markets will you work on from here?
The whole world. We are going to have an international audience at conferences. From Norway to Brazil, the world is going to get to know the Weinviertel. However, the biggest challenge is: We definitely need good accommodations.
How big is your own record collection?
24,000 records. My taste in music developed from rock, pop, Deep Purple, jazz, rock, Flower Power to classical. One personality deeply influenced my career Manfred Schilder, a teacher who used a fantastic system during the music lessons at secondary school in Gänserndorf to show us how an opera can sound.
You constantly work with artists. The most exciting must have been the record made of ice, onto which specially composed music was played by melting recording mediums. Does the Pro-Ject withstand water?
Yes, it does. Artist always approach me and we support art projects. Maybe we will revive this project with the ice record again at the logistics centre at the Business Park A5