Management Summary

  • Romania shows low average labour costs compared with the EU. This figure is a starting point, but not a complete site calculation.
  • The decisive figure is the total cost per saleable unit with stable quality and realistic utilisation.
  • In addition to personnel, property, energy, logistics, scrap, management, recruiting, financing, ramp‑up and risk reserves belong in the calculation.
  • Region, industry, qualification and shift model can change the national average considerably.
  • A site is only economically viable if the advantage remains under conservative assumptions and in a stress scenario.

Why a Wage Comparison Falls Short

When assessing a site in Romania, almost every discussion starts with wages. This is understandable: personnel costs are a major cost block in many production and assembly processes. Eurostat estimates the average hourly labour cost for the Romanian economy in 2025 at €13.60. The EU average was €34.90.

This gap is relevant, but it must not be equated directly with a possible saving. The Eurostat figure covers the whole economy and is neither an offer for a specific occupation nor a wage band for a particular city. Moreover, labour costs in Romania rose by 10.6 % in local currency in 2025. Anyone investing today therefore has to consider not only the current level but also the development over several years.

The correct target metric is not “wage per hour”, but:

Total cost per defect‑free, on‑time delivered product at stable utilisation.

1. Capture Direct Personnel Costs in Full

Personnel accounting includes more than gross wages. For each required role a realistic regional wage band should be collected. This is supplemented by employer contributions, allowances, bonuses, overtime, shift premiums, holiday, sickness, work clothing, occupational health requirements and other company benefits.

The organisational model also changes the costs. A single‑shift operation needs different reserves than a two‑ or three‑shift model. A line with many learned tasks has a different recruiting and training profile than CNC machining, welding, maintenance or quality assurance.

A robust personnel calculation therefore distinguishes at least:

  • direct production workers,
  • shift and team leaders,
  • quality and test equipment,
  • maintenance and engineering,
  • logistics and warehousing,
  • administration, HR and accounting,
  • plant or site management,
  • holiday, sickness and turnover reserve.

2. Compare Productivity Rather Than Hourly Rate

Lower hourly costs help little if training time, scrap or downtime are higher than assumed. In the early phase of a new site, reduced line performance and additional support needs are normal. Consequently, the calculation should model a ramp‑up curve rather than assume the later target productivity from month one.

At least three points in time are useful:

  1. Start‑up and training,
  2. Controlled series ramp‑up,
  3. Stable operation.

For each phase, output, scrap, re‑work, support hours and possible special transports are calculated. Only from this a comparable unit‑ or process‑cost figure emerges.

3. Property and Site Preparation

The square‑metre price of a hall is only part of the property cost. What matters is whether the space can accommodate the process without disproportionate adaptations.

Items to check include, among others:

  • rent or purchase price,
  • deposit, financing and ancillary costs,
  • hall height, floor load capacity and column grid,
  • doors, ramps and truck access,
  • fire protection and insurability,
  • heating, ventilation and cooling,
  • crane runway or foundations,
  • office, welfare and storage areas,
  • permits and technical adaptations,
  • expansion reserve and restoration obligations.

A cheap existing space can become expensive if the power connection, fire protection or floor bearing capacity do not fit. Conversely, a higher rent can be economical if the space enables a faster and safer production start‑up.

4. Energy, Media and Supply Security

For energy‑intensive processes, a national electricity price is insufficient. Companies must examine power, load profile, connection capacity, grid quality and required investments at the specific plot or building.

The calculation should include:

  • electricity consumption and peak loads,
  • grid connection and possible reinforcement,
  • gas, heat or alternative energy carriers,
  • water and wastewater,
  • compressed air and technical gases,
  • backup power or redundancy,
  • metering, maintenance and energy‑related permits.

Price forecasts must be treated with scenarios. A best‑case alone is not an investment basis.

5. Calculate Logistics Across the Entire Supply Chain

The distance between Romania and the DACH region affects procurement, delivery, inventory levels and response time. Relevant are not only normal freight rates but also frequency, utilisation and disruption risk.

The calculation should cover:

  • inbound logistics and supplier pick‑up,
  • outbound logistics to the customer or parent plant,
  • packaging and load carriers,
  • intermediate storage and safety stock,
  • capital tied up during transport,
  • tolls, surcharges and seasonal effects,
  • express and special trips,
  • return of empties and scrap,
  • costs of delayed delivery or production interruption.

Romania’s full Schengen membership has facilitated person mobility across internal borders since 2025. It does not replace a concrete route and lead‑time analysis. Temporary controls, construction sites and traffic bottlenecks remain possible.

6. Make Quality and Coordination Visible

Quality costs are often underestimated in early site models. They include test equipment, laboratory services, sampling, certification, re‑work, scrap and customer complaints. Coordination between the parent plant, the Romanian site, suppliers and external partners also adds cost.

Especially in the ramp‑up phase, travel, translation, training and management expenses arise. These costs are not automatically permanent, but must be included in the investment and ramp‑up budget.

7. One‑off Set‑up and Start‑up Costs

A site comparison must not mix ongoing costs with one‑off investments. For the decision both are presented separately and examined over a sensible period.

Typical one‑off costs are:

  • site search and technical assessment,
  • legal, tax and permitting advice,
  • planning and refurbishment,
  • machine and tool transport,
  • installation, connection and commissioning,
  • recruiting and training before series start,
  • IT, ERP, security and communications,
  • sampling and customer approvals,
  • dual operation during the transition phase,
  • reserve for delays.

LIBERRA does not organise machine dismantling at the existing site. In a later implementation, coordination for transport, erection, commissioning and ramp‑up can commence.

8. Place Taxes and Incentives Correctly

Taxes and incentives can influence an investment calculation, but they should never replace the operational suitability. Incentive programmes have conditions, deadlines, state‑aid limits, documentation obligations and often long‑term commitments.

Therefore the rule is: first, the site must be operational without unrealistic incentives. Afterwards, possible programmes are examined by qualified tax and incentive experts. All tax and incentive information remains case‑specific and must be verified.

Three Scenarios Instead of a Single Figure

A professional site calculation contains at least:

  • Base scenario: realistic assumptions for volume, personnel, productivity and transport.
  • Stress scenario: delayed recruiting, lower utilisation, higher wages, more scrap or logistics costs.
  • Expansion scenario: additional shift, second line or higher automation.

The key question is whether the site remains financially viable in the stress scenario. If the business case only works under perfect utilisation and without delays, the risk is too high.

Checklist for Your Total Cost Calculation

  1. Is the process to be relocated or built clearly defined?
  2. Are regional wage bands assigned for all roles?
  3. Has a realistic productivity and ramp‑up curve been calculated?
  4. Is the hall technically assessed and not only price‑compared?
  5. Are energy connection and supply risks clarified at the specific site?
  6. Does the logistics calculation include inventory, express cases and capital binding?
  7. Are quality, leadership and coordination fully accounted for?
  8. Are one‑off and ongoing costs separated?
  9. Is there a stress scenario with sufficient liquidity reserve?
  10. Have own‑site, partner solution and pilot been evaluated comparably?

Conclusion: Viability Emerges from the System

Romania can offer a significant cost advantage, especially for suitable, labour‑intensive and well‑planable processes. However, the gap in average labour costs does not equal the eventual site outcome.

A robust decision links personnel, productivity, property, energy, logistics, quality, leadership and ramp‑up. It shows not only a saving but also the investment, the break‑even point and the risks of deviations.

Next step: In the Romania Site Check we compare not only wages but the total cost of your specific process – with realistic regional assumptions and a clear presentation of opportunities, limits and risks.