Hungary is in focus for Continental
Continental has appointed Dániel Rábai – managing director of tire trade center and president of the Hungarian Tire Association – as the representative of Continental group in Hungary. We asked him about his new tasks, the latest trends and of course about the future of the heavily battered Hungarian market.
Q: As a newly appointed representative of the Continental group, how do you see its presence in Hungary?
A: According to the turnover of the group, we belong to the top 25 companies in Hungary. Through Continental’s five divisions (Interior, Chassis & Safety, Powertrain, ContiTech, and Tire), the group performs manufacturing, software development and commercial activities in Budapest, Veszprém, Szeged, Makó, Vác, Nyíregyháza and Budaörs. Altogether we employ nearly 6,000 people. Continental group’s subsidiaries are very active in the field of investments. For example, Continental Automotive Hungary has spent almost HUF 15 billion in investment and job creation between 2009 and 2014. The extensions granted HUF 2 bln worth of support from government and EU sources, in return the company promised to create 477 new jobs. Moreover other subsidiaries are also continuously improving and expanding every year, so we really are a major player in the Hungarian automotive industry, as an employer and an investor too.
Q: What responsibilities do you have to take over with this appointment?
A: First of all, I am responsible for the coordination and representation of the group’s common goals and also for supporting communications tasks. But I have other duties as well. In accordance with the strategic agreement we signed with the Hungarian government, I will support the future of the domestic education of engineers and the research and development based on future needs. Altogether, I represent the common interests of the employees and Continental Group towards the Hungarian media, external partners, professional organizations, civil society and the Hungarian government.
Q: What does the strategic agreement means to Continental in practice?
A: In April, we signed the strategic agreement with the government. In practice, it means reassuring guarantees for the future for both parties. We already have achievements, for instance, the expansion of the warehouse capacity in Budapest and the development of production technology of small- and medium-sized servomotors were both implemented as part of the strategic agreement. But these are only first steps; Continental plans to create more jobs in the near future with the help of the government. However, in the past 20 years, we have already made significant investments without written commitments. Our presence in Hungary is very important and our work draws high attention on an international level too. We established our first Hungarian subsidiary in 1991 and in the last seven years €334 million worth of investments were carried out.
Q: As the managing director of the tire trade subsidiary, how do you see the current state of the tire market? How did the crisis in automobile traffic affect tire consumption?
A: The Hungarian car tire market fell by 5% in the first eight months of the year, while the same market in Europe deteriorated by only 4%. This doesn’t mean that the consumer side is reduced to this level, this figure shows that the manufacturer’s representatives in Hungary sold less tires to their dealer partners. The cause behind this decrease was primarily that the winter tire deliveries were scheduled earlier last year due to the volatile EUR/HUF exchange rate. But generally speaking, the tire market, just as with new car sales, could not recover from the 2009 downturn. In passenger tires, last year’s total sales were close to two million, compared to 2.5 million five or six years ago.
Q: How do you see tire development trends in the future – what will be the next generation tire?
A: We are in the fortunate position that we are not only tire manufacturers, but produce other vehicle parts as well, such as brake and vehicle stability systems, steering servo and many other parts. Due to the changing needs of the automotive industry, we are able to anticipate/prepare rather than react to the latest development trends. Security will always be a central issue for the tires; think of the much-talked-about four-palm surface a car rolls on. Also, hybrid and electric cars represent an important new direction in development. In their case, efficiency and energy saving have a greater significance and they require entirely different geometry and rubber mixtures. Another important development is the area of recycling, where ground rubber (rubber grind) is becoming more widely used. In the spirit of environmental management goal, of course, that grind would be turned back into the production of new tires. For technological reasons it’s still an area open for improvement, but the proportion of “re-tire” in new car tires will increase by time, as its industrial use is already important.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.