Foreign investors expand automotive industry projects in Hungary

Higher volume production of car engines, transmission units and tires, EUR hundreds of millions of investmentsand thousands of jobs – three foreign companies, already based in Hungary, have announced the increase of their capacities.

Opel is to invest EUR 500 million to expand its engine factory in Szentgotthárd, southwestern Hungary, creating a thousand new jobs. That was announced by the vice president of Manufacturing in Opel/Vauxhall Europe, Reinald Hoben and Hungarian prime minister Viktor Orbán. The latter added that his government would make a decision mid-October on what sort of support it would provide for the investment. The Hungarian side calculates that the state subsidy will be returned on the level of the national economy in four years. Regarding the supplier background, the Opel investment is expected to create further 2,500-3,000 jobs.

Also in Szentgotthárd, the American company Allison Transmission Ltd. will build a new transmission manufacturing plant in the local industrial park. Szentgotthárd mayor Tibor Viniczay says the local government has already signed an agreement on the investment with the management of the company. In another part of the industrial park, Allison will continue to produce automatic transmissions after moving out of the area of the Opel plant to make expansion possible for the engine manufacturer. Allison plans to put on the market a new and modern product and the new factory hall is likely to be the place for manufacturing and testing that. The planned production volume is 3,000-4,000 automatic transmissions a year.

The South Korean tire manufacturer Hankook plans to further expand its plant near Dunaújváros, central Hungary and – as a mid-term goal – to manufacture truck tires, also. “The company makes continuous investments to expand its European manufacturing base with EUR 230 million spent until 2011,” says the communication manager of Hankook Tire Hungary Ltd., Katalin Roy. In Hankook’s Hungarian factory, opened in 2007, over 1,400 employees currently produce some 17,000 tires a day in 300 different sizes.