Daimler to Set up Second Plant in Hungary for Mercedes-Benz
Hungary: The
German automobile multinational is poised to invest USD1.1 billion for
establishment of Mercedes Benz plant to be based in Kecskemet, Hungary. This is
the second time company is setting up plant for Mercedes in Hungary. The plant
is expected to produce both front and rear wheel drive cars, and will also be
capable of producing alternative powertrain models.
Establishment of this plant is expected to
provide employment to around 2,500 people in Hungary, and the investment is
believed to be completed by 2020, claims the company. The new set up is likely
to be enabled with a production capacity of around 150,000 as per the statement
of Hungarian foreign minister Peter Szijjarto. Additionally, the government has
also offered incentives worth USD45.9 million.
Currently, Mercedes Benz has a product
portfolio consisting of 32 models, however, in the coming years, the company is
believed to offer 40 models. Moreover, it is expected that all the passenger
car models will go through electrification in future.
"In the next few years, we plan to invest
around USD1 billion in building a new plant at our site in Kecskemet. We will
establish a state-of-the-art and efficient production facility, in which
different vehicle architectures will roll off the assembly line flexibly. With
this highly modern 'flex-plant', we will create additional capacity along with
the necessary flexibility according to Industry 4.0 benchmark approaches
allowing us to react quickly and future-oriented to the market needs. Our
company strengthens its competitiveness," said Markus Schafer, Member of
the Divisional Board Mercedes-Benz Cars, Production and Supply Chain
Management.
As
per TechSci Research, with successful completion of this plant, the company is
believed to strengthen their product portfolio in the country. Further, with
this move, the country’s tire market will also be supported by the increasing
demand arising from the OEM segment, thereby, crafting an opportunity to
leading tire manufacturers in Hungary.
According to a recent report published by TechSci Research, “Hungary
Tyre Market Forecast
and Opportunities, 2020”,
the country’s tire market is projected to grow at over 8% CAGR during 2015-2020.
In 2014, the replacement tire segment in Hungary accounted for more than 50% of
market share. The passenger car tires segment accounted for more than 90%
volume share in the Hungary tire market, followed by light commercial vehicle
tire, medium & heavy commercial vehicle tire, two-wheeler tire and OTR tire
segments. Hankook, Bridgestone and Michelin operate their tire manufacturing
plants in the country, while global tire companies like Goodyear, Pirelli,
Continental, Vredestein, etc., operate through their sales offices in Hungary.