Hungary’s Investment Agency says strong domestic economic performance remains a powerful tool to attract manufacturing sectors as the country continues its presence as an automotive hub.
As part of the Visegrad 4 countries, sharing with Slovakia, Poland and Czech Republic, Hungary has attracted a significant number of suppliers and OEMs keen to take advantage of its educated workforce and good transportation links, which is seeing the auto sector take centre manufacturing stage.
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“Based on third-quarter data, there is GDP growth of 5% – this is the number one growth in Continental Europe,” said HIPA CEO, Robert Esik at this year’s Central & Eastern European Automotive Forum organised by Adam Smith Conferences in Budapest.
“We continue to be a a very stable economy – the budget deficit plan for next year is 1%. We [also] continue to improve the taxation system [and there have been] additional tax cuts which have been implemented. We maintain our corporate tax rate of 9% which is the only single digit rate in the European Union. We [equally] have excellent results in terms of foreign direct investment.
“Speaking about the automotive eco-system, we have eight OEMs in Hungary – five with manufacturing and three with services. We have also 43 of the world’s top Tier 1 auto companies with manufacturing activities. We put a very strong emphasis on these two areas of autonomous driving and electrification.”
Esik noted Hungary had received EUR1.2bn in “committed expenditure” for large scale automotive projects, with Audi for example, the largest FDI provider, while PSA with its engine plant as well as BMW and Daimler continue to maintain their presence.
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By GlobalData“The good news is next year, the new generation PSA engines will be produced in Hungary, [while] Daimler has completed its new paint shop,” added Esik. “Ford is getting close to 800 people here in Budapest for its administration centre.
“We can clearly see an extremely strong rise in investment related to battery production – we are becoming a battery production superpower. Investments also trigger other investments. The government also needs to make investment to make the environment attractive and I am happy to report we have been able to open the first phase of the proving ground to test traditional and autonomous vehicles.
“We are here and ready to help. What we ask automotive companies to do is not necessarily to commit additional jobs, but commit to maintaining head count; in this case we are able to contribute to capital expenditure.”
