Hungarian Investment and Trade Agency

Automotive Industry in Hungary

2014

Hungary: home of automotive investments

•

Audi

Hungaria Motor Kft. in Győr produces engines for all brands in the VW Group and has a brand new production plant for A3 Cabriolet and A3 Limousine, together with the new generation of TT Coupé and TT Roadster.

•

Mercedes-Benz

Manufacturing Hungary Kft. has picked Hungary as its first plant in Eastern Europe, producing the Mercedes B and CLA models. • Magyar

Suzuki

Zrt. has assembly lines in Esztergom, producing Suzuki Swift, Splash, SX4 and SX4 S-Cross.

•

Opel

Szentgotthárd Kft. produced Opel Astra cars at the beginning, afterwards they manufactured engines, cylinder heads, crankshafts and piston-rods.

H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Overview: major OEMs in Hungary

AUDI Hungaria Motors Kft.

Location: Győr Foundation: 1993 Products: TT Coupé/Roadster, A3 Cabriolet/Limousine Car. prod. cap.: 125.000

Engine prod. cap.: 1.900.000

Nr. of employees: 10.300

Revenue (2012): EUR 5,282 billion

Miskolc Szombathely Győr Tatabánya Esztergom Hatvan BUDAPEST Székesfehérvár Szolnok Nyíregyháza Debrecen Szentgotthárd Kecskemét

General Motors Powertrain (GM) Location: Szentgotthárd Foundation: 1991 Products: engines, cylinder heads, gearboxes Engine prod. cap.: 1.000.000 (2015) Nr. of employees (expected): 1000 (1,500 - 2015) Revenue (2012): EUR 86,7 million

Pécs Szeged

H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699 Magyar Suzuki (Suzuki Motors) Location: Esztergom Foundation: 1991 Products: Swift, Splash, SX4 S-Cross Car. prod. cap.: 300.000

Nr. of employees: 3.100 Revenue (2012): EUR 1,4 billiion Mercedes-Benz Manuf. (Daimler) Location: Kecskemét Foundation: 2008 Products: A and B Class, CLA Car. prod. cap.: 150.000

Nr. of employees: 3.000

Revenue (2012): EUR 0,92 billion

(Operation started in March 2012)

Facts and figures

• • • • • • • Production value : 19.4% of total industrial production Automotive industry gives in 2012 ) 20% of Hungary’s total exports (16,65 bn EUR Main export market: EU (75 %) No. of companies: cca. 700 No. of employees: cca. 115,000 Average gross salary: 824 EUR/month be manufactured in Hungary in 2014 (Eurostat, 2013 June) Forecast: more than 2,3 million engines and 400.000 passenger cars will H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Top reasons for Hungary I.

•

Central location

At the crossroads of 4 main European

transportation

corridors Ideal logistical center for the automotive industry (More than 90% of Hungary’s automotive production goes for export) •

Cost efficiency

Competitive wages and labor cost/value ratio in European comparison in the CEE region.

•

Tradition of innovation

Long and successful tradition of cooperation between the universities and the producers in R&D.

•

Long-term planning

   Solid political and public institutional framework Stable economic outlook Harmonized tax system H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Competitive average wages Gross wages, Industry ( €) 2013 June

1600 1400 1200 1000 800 600 400 200 0

1435 986 976 960 927 891 876 824 710 671 664 535 500 424 383 355

Source: wiiw, Eurostat, national statistics H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

High average yearly working hours (2012)

1920 1900 1880 1860 1 912 1 894 1 884 1840 1820 1800 1780 1760 1 837 1 829 1740 1720 Hungary Bulgaria Slovak Republic Romania Czech Republic Source: IMD, World Competitiveness Online 2013 1 793 1 792 Poland Slovenia H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Gross wage levels in European cities New York=100 (2012)

140 120 100 80 60 40 20 0 Source: UBS, Wealth Management Research, Prices and Earnings, 2012 September H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Automotive competence centers Competencies in the Regions – Alignment of the Academic and Industrial Main Priorities

• • • • •

Győr

(engine, vehicle manufacturing)

Veszprém

(mechatronics, fuels and lubricants)

Budapest

(vehicle technology, electronics, mechatronics)

Kecskemét

sciences, vehicle assembly) (material

Miskolc

(driveline systems, mechatronics) H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Top reasons for Hungary II.

Strong supplier base:

• Over 700 companies in the automotive sector • 15 of the 20 leading Tier 1 companies settled down in Hungary • Hungarian automotive suppliers have several years of experience supplying OEMs & Tier 1s • Strong governmental supplier development activity • Extended vertical and horizontal supplier connections H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Hungary: home of automotive investments

OEM Tier 1 Tire man.

And many more… R&D

H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

AFL Ajkai Elektronika Albert Weber Alcoa Asahi Glass Benteler Borg Warner Bourns Bridgestone Continental Autom.

Denso Diamond Electric Euro Excedy Gedia Gestamp Hammerstein Hankook ITW Siewer Johnson Controls Karsai Plast Kirchhoff Lé Belier Lear Magyarmet Michels Musashi Plasticor Plastimat Poppe+Potthoff Rába SCI Sanmina SCS SEWS Suoftec Toyo Seat U-Shin Valeo Videoton Visteon Wescast Central Transdanubia Western Transdanubia Arcelor Autoliv B.O.S.

BPW Rába Car-Inside Dana Dekorsy Delphi Edag EMT Erbslöh Euro Exedy Euro Elzett Federal Mogul Győri Plast Hirschler Kravtex Luk Savaria Magna Steyr Nemak Rába Rehau Rekard Produkt Rudolph Logistik Semperform Veritas SMR Vogel und Noot

More than 700 suppliers

AVL Cascade Clarion Continental Autom.

ContiTech Fluid Draexlmaier EMT Excel Csepel FESTO GE Lighting Hokushin Ibiden Lear MGM Michelin Mono-Ipolyfabric NABI PEMÜ Schwarzmüller Semcon Central Hungary Siemens VDO Tauril ThyssenKrupp Toyo Seat Vogel Sitze Webasto W.E.T.

Zollner Southern Transdanubia BHG CabTec Ratipur Interplus Northern Hungary Akzo Nobel Coatings Firth Rixson ARRK Ganz Foundry Bosch Gibbs CSABAcast Delphi Hi-Lex Knaus Tabbert Delta-Tech Exir Kovács Lear Leoni Mitsuba Modine Prec-Cast Remy Saia-Burgess Salgglas Shinwa Stanley Electric Starter Battery Technoplast ZF Southern Great Plain Brose ContiTech Fluid ContiTech Rubber Csaba-Metál Eckerle Emika EuroFit Freudenberg Hirschmann HBPO Johnson Controls KALOplastic Knorr-Bremse Kunplast-Karsai Linamar Magna Exteriors Pata Phoenix Mecano ThyssenKrupp Zorge Northern Great Plain Caroflex Carrier Transicold Eagle Ottawa Eismann FAG (Schaeffler) Faurecia Euroszol F.Segura

Hajdu Autó Haldex Hübner Isringhausen Jász-Plasztik Lé Belier Michelin Nief Phoenix

Light vehicle production in the Central and Eastern European Region (in thousand units)

Source: Ernst & Young, The Central and Eastern European automotive market, 2010 H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

About the Hungarian Investment and Trade Agency - HITA

• Founded by the Hungarian Government in 2011, in order to assist in achieving its external economic policy goals • The supervising body of HITA is the Prime Minister’s Office • 150 employees, mainly consultants on sectorial basis

Our main tasks are:

• Support the foreign trade activities of Hungarian undertakings • Training of SMEs enabling them to be involved into multinational companies’ supply chain • Organizational Structure    Investment Promotion Directorate Business Development Directorate Enterprise Europe Network (EEN) H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Our services for successful investments

Pre-decision

   Tailored and comprehensive information packages on the economy, financial incentives, business environment, tax Assistance in location search and evaluation, site visits organized Partner meetings organized

Ramp-up Operations

   Project partner and project financing advisory Supplying information on permitting procedures Assistance in applications for incentives   Expansion assistance Advocacy to improve the business climate H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Our services for successful investments: Incentives

Services of the Incentives Department:

• EU co-financed tenders • Subsidy based on individual government decision • Development tax allowance • Job creation subsidies • Training subsidy H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Our services for successful investments: Supplier Department (I.)

• Regular personal meetings with management for setting up and reviewing supply strategy and project plan • Longlisting business contacts about possible Hungarian suppliers • Parametering the possible Hungarian suppliers • Prefiltering business contacts for the OEMs • Shortlist business contacts to maximize the chance of the successful cooperation H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Our services for successful investments: Supplier Department (II.)

• Match-making between the OEM and the suppliers • Business Seminars, Conferences, Supplier Days, Shows & Exhibitions • On request establishing business relationship • On request consultancy with other governmental organs • Follow-up meetings • Building interactive supplier database and e-market service H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699

Thank you for your kind attention!

H 1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699 Contact us: Web: www.hita.hu

E-mail: [email protected]

Phone: +36 1 872-6520