The Elhim Iskra battery factory in Pazardzhik is closing

Elhim Iskra AD, one of Bulgaria’s leading battery manufacturers with over 60 years of history, is closing down. At a meeting of the company’s Board of Directors held on March 4, the board decided to immediately suspend operations for a 19 d “break” and to lay off all workers on the 20th day.

The Pazardzhik-based company explained the surprising actions by the company’s difficult financial and economic situation. This is the result of a combination of factors, such as the loss of market positions in Italy and Germany due to the prolonged decline in industrial production and the emergence of manufacturers from Turkey, China and India who have significantly lower labor and energy costs and offer more competitive prices.

Prior to that the company lost its most profitable markets in the CIS countries as a result of the military conflict in Ukraine and the sanctions imposed by the EU against Russia.

Lack of state compensation for expensive electricity

The statement explicitly cites high electricity prices in Bulgaria and Europe as a reason, as well as “the lack of a real compensation mechanism for state support for non-domestic end users.”

We recall that the Zhelyazkov cabinet failed to implement an effective programme to compensate energy-intensive enterprises for the high cost of electricity on the exchange. After a long delay the previous government approved a new compensation mechanism in October – support was to be received for each 1 MWh of electricity consumed as the difference between the achieved exchange price and the price set for the period, which is BGN240/MWh. The Electricity System Security Fund was to provide the money.

However until it left office on February 19, 2024, the Zhelyazkov cabinet did not take any action to implement it. It even had to act retroactively – from July 1, 2025, when the previous program ended.

Elhim Iskra cites other reasons for the closure: high prices of raw materials and supplies essential to the company and regulatory restrictions on lead recycling; the annual administrative increase in the minimum wage and the lack of qualified personnel, which necessitate a constant increase in wage costs without leading to an increase in productivity.

The company’s activities

The majority owner of the company is Stara Planina Hold AD.

The company specializes in the design and manufacture of a wide range of lead-acid batteries: Elhim Iskra is a highly export-oriented company, with exports accounting for 70 – 80% of its turnover. Its main markets are Germany, Greece, Italy and France while historically strong markets have been Russia, Serbia and the Middle East.

• Traction batteries and cells: These are mainly used for electric cars, forklifts and other lifting and transport equipment. This is one of their strongest segments;
• Starter batteries: For passenger cars, trucks and agricultural machinery;
• Stationary and solar batteries: Designed for the energy, telecommunications and renewable energy sectors (energy storage);
• Special batteries: Products for military or specific industrial applications.

On the domestic market the company supplies large industrial enterprises and has a strong presence in the commercial network for automotive batteries.

Translated with DeepL.