Hungarian Investment and Trade Agency Automotive Industry in

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 A 3 Cabriolet and A 3 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, SX 4 and SX 4 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 Magyar Suzuki (Suzuki Motors) Location: Esztergom Foundation: 1993 Products: TT Coupé/Roadster, A 3 Cabriolet/Limousine Car. prod. cap. : 125. 000 Engine prod. cap. : 1. 900. 000 Nr. of employees: 10. 300 Revenue (2012): EUR 5, 282 billion Foundation: 1991 Products: Swift, Splash, SX 4 SCross Car. prod. cap. : 300. 000 Nr. of employees: 3. 100 Revenue (2012): EUR 1, 4 billiion Miskolc Győr Tatabánya Szombathely Szentgotthárd Nyíregyháza Esztergom Hatvan BUDAPEST Székesfehérvár Debrecen Szolnok Kecskemét Szeged General Motors Powertrain (GM) Pécs Location: Szentgotthárd Foundation: 1991 Products: engines, cylinder heads, gearboxes Engine prod. cap. : 1. 000 (2015) Nr. of employees (expected): 1000 (1, 500 - 2015) H-1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699 Revenue (2012): EUR 86, 7 million 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 20% of Hungary’s total exports (16, 65 bn EUR in 2012 ) • Main export market: EU (75 %) • No. of companies: cca. 700 • No. of employees: cca. 115, 000 • Average gross salary: 824 EUR/month (Eurostat, 2013 June) • Forecast: more than 2, 3 million engines and 400. 000 passenger cars will be manufactured in Hungary in 2014 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 1600 Gross wages, Industry (€) 2013 June 1435 1400 1200 1000 986 976 960 800 600 927 891 876 824 710 671 664 535 400 500 424 383 355 200 C ze Sl ov en ch ia R ep ub lic Es to ni a C ro at ia Po la nd Sl ov ak M ia on te ne gr o H un ga ry La tv ia Li th u Ka ania za kh st an Se rb ia R om an M ia ac ed on ia Bu lg ar ia U kr ai ne 0 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) 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 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 Sofia Bucharest Budapest Vilnius Warsaw Riga Prague Bratislava Talinn Ljubljana Athens Lisbon Rome Madrid Barcelona Nicosia lyon Milan Dublin Paris Amsterdam Berlin London Vienna Helsinki Brussels Stockholm Frankfurt Munich Luxemburg Oslo Geneva 0 Zurich 20

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 (material sciences, vehicle assembly) • Miskolc (driveline systems, H-1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699 mechatronics)

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 1 s • 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. R&D H-1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699 And many more…

More than 700 suppliers 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 AVL Cascade Clarion Continental Autom. Conti. Tech Fluid Draexlmaier EMT Excel Csepel FESTO GE Lighting Hokushin Ibiden Lear MGM Michelin Mono-Ipolyfabric NABI PEMÜ Schwarzmüller Semcon Northern Hungary Akzo Nobel Coatings ARRK Bosch CSABAcast Delphi Delta-Tech Exir Siemens VDO Tauril Thyssen. Krupp Toyo Seat Vogel Sitze Webasto W. E. T. Zollner Central Hungary Northern Great Plain 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 Firth Rixson Ganz Foundry Gibbs Hi-Lex Knaus Tabbert Kovács Lear Leoni Mitsuba Modine Prec-Cast Remy Saia-Burgess Salgglas Shinwa Stanley Electric Starter Battery Technoplast ZF Southern Great Plain Southern Transdanubia BHG Cab. Tec Ratipur Interplus Brose Conti. Tech Fluid Conti. Tech Rubber Csaba-Metál Eckerle Emika Euro. Fit Freudenberg Hirschmann HBPO Johnson Controls KALOplastic Knorr-Bremse Kunplast-Karsai Linamar Magna Exteriors Pata Phoenix Mecano Thyssen. Krupp Zorge 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 Ramp-up Pre-decision ü ü ü 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 ü ü ü Project partner and project financing advisory Supplying information on permitting procedures Assistance in applications for incentives Operations ü ü 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! Contact us: Web: www. hita. hu E-mail: investment@hita. hu Phone: +36 1 872 -6520 H-1055 BUDAPEST, HONVÉD UTCA 20. PHONE: (+36) 1 872 6520 FAX: (+36) 1 872 6699