Electric Vehicle Giants Set to Boost Hungary's Ailing Economy

Hungary's struggling economy may find relief in 2025 as automotive giants BYD and BMW prepare to launch production at their new facilities, marking a significant expansion of the country's automotive sector.

Chinese Ambassador Gong Tao announced during a recent visit to Szeged that BYD's first European plant will begin manufacturing vehicles in November 2025. Meanwhile, BMW's Debrecen facility, where construction began in summer 2022, is scheduled to start producing its fully electric Neue Klasse model that same year.

The BMW plant will begin pre-series production by the end of 2024, with an initial capacity to paint 30 car bodies per hour and room for future expansion. The plant, which incorporates special environmental protection technologies, will be the first painting plant in the BMW Group’s global production network to completely break the fossil fuel cycle.

The timing coincides with surging European demand for electric and hybrid vehicles, which now represent 44% of car imports into the EU, up from just 8% in 2017. "Europe's trendiest car industry companies are making electric engines and cars in Hungary," noted Foreign Affairs and Trade Minister Péter Szijjártó during a summer inspection of the BMW site.

These developments reinforce Hungary's position as a key automotive manufacturing hub in Central and Eastern Europe. The country's strategic location, skilled workforce, and business-friendly policies have already attracted major manufacturers including Audi, Mercedes-Benz, and Suzuki. EU membership further enhances its appeal by ensuring regulatory alignment and market access.

The expansion comes at a crucial time for Prime Minister Viktor Orbán's government. Hungary's economy entered a technical recession in the third quarter, contracting 0.7% as farming, industry, and construction sectors weakened. With a challenging 2026 election ahead, Orbán's chief of staff Gergely Gulyás expressed optimism about the economic boost these new plants could provide.

"The optimism for next year's economic policy is supported by current developments, the new plants of BYD and BMW are going to start production next year, in the second half of next year," Gulyás told reporters.

While some EU nations seek to reduce dependence on China, Orbán continues to strengthen trade ties with the world's second-largest economy, actively courting Chinese EV and battery manufacturers to establish operations in Hungary.