Daimler to built €800 mln plant in Hungary - update

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German carmaker Daimler has selected Hungary as the site for its planned East European plant, Dow Jones reported on Wednesday.

Daimler will invest around €800 million in the Hungarian plant, to be built in Kecskemét (southeast Hungary) according to the report and the plant will create 2,500 new jobs. Florian Martens told MTI Daimler’s board unanimously decided to build the plant in the Hungarian city of Kecskemét.

The new plant is part of Daimler’s plans to expand its compact car models to four from two, the Stuttgart, Germany-based automaker said today in an e-mailed statement, according to Bloomberg. Daimler considered sites in Romania, Poland and Serbia, in addition to Hungary, for the plant, according to press reports. Daimler currently makes the A- and B-Class models at its plant in Rastatt.

 

Hungary wasn’t decided by the amount of government subsidy that Budapest offered, Hungarian Prime Minister Ferenc Gyurcsány said. “All three countries competing for the investment (including Poland and Romania) offered the maximum amount of state support that the European Union allows,” Gyurcsány said at a press conference following Daimler's announcement earlier Wednesday.

The subsidy packages includes tax breaks, education subsidies and cash support, Gyurcsány said, adding that the exact size of the package will only be made public after the two parties sign the contract. “Never in the history of modern Hungary has such a large investment been launched,” Gyurcsány said. offered, Hungarian Prime Minister Ferenc Gyurcsány said.

Car manufacturing has a 15% weight in Hungary’s overall industrial output and it accounts for over 20% of Hungary’s exports. The new plant, located in the city of Kecskemét, will produce 100,000 class A and B Mercedes cars annually at the start will initially employ 2,500 people and a further 10,000 through the network of suppliers that will service the facility, Gyurcsány said. (MTI-Econews, Bg)

 

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