Hungarian automotive industry: week 42
Last week was characterised by a fluctuating Hungarian currency, decreasing oil prices and a moderate growth in Hungary´s gross production output due to a less productive summer period in the country´s automotive industry. It was also reported that Suzuki switched back to single-shift operation, while Hungary´s bus manufacturing found a Russian partner.
Let's look at what happened in Hungary's economy automotive industry during the 42nd week this year.
Manufacturers
Last week we had an insight into how V6 engines are manufactured at Audi Hungaria's Győr-based plant. We paid a short visit to Audi Hungaria Kft.'s engine production department responsible for the manufacture of V6 diesel engines and we also had a look at the 4-cylinder petrol production line. Last week we reported that Audi Hungaria has launched a volunteer programme where its employees can unite for a good cause.
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| Factory visit at Audi Hungaria's V6 engine department |
The Esztergom-based plant of Magyar Suzuki returned to a single-shift operation in September. There are two reasons behind the decision: the production of the original SX4 and Splash models has been phased out and the new production line for the new Suzuki Vitara, unveiled at the Paris Motor Show, is already being set up. Last week, the Esztergom-based plant donated a 1.6-litre petrol SX4 S-Cross to the Vaszary Kolos Hospital.
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| Magyar Suzuki returns to one-shift operation to prepare production line for new Vitara |
Hungarian bus manufacturer Evopro Group and Russian Nanotechnology Centre for Composites have signed a cooperation agreement on the manufacture of composite buses at the Open Innovations Forum in Moscow.
Suppliers
Bosch's Budapest Development Center employed its 1,000th employee in May. Five months after that major milestone the company welcomed its 1,100th engineer last week.
Car seats manufacturer Magyar Toyo Seat Kft. received HUF 168 million support for a HUF 825 million HUF project to open a new production facility in Nyergesújfalu.
Jász-Plasztik Kft., an automotive supplier under full Hungarian ownership, has built a new battery plant with a HUF 10.3 billion (EUR 33 million) investment, creating 350 new jobs and increasing the company´s headcount to 2,800.
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| Toyo Seat supplies the Hungarian Suzuki plant with automotive seats |
Education
Hungary's Ministry for National Economy (NGM) wants to establish a homogeneous vocational training system and is planning to take over vocational schools from Klebelsberg Institution Maintenance Centre, NGM announced last week.
The higher education institute announced last week that the new building of Kecskemét College's Faculty of Mechanical Engineering and Automation had been named after Pál Michelberger, an outstanding Hungarian automotive engineer. Last week, Hankook and Dunaújváros College launched their dual education programme.
TechTogether
Formula Racing Miskolc, the last team in our TechTogether series was presented last week. The primary aim of the team is to gain practical experience and be one step ahead of their peers with similar qualifications on the labour market.
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| Formula Racing Miskolc |
Service providers
Waberer's, one of Europe's largest haulage firms, has established a subsidiary at Britain's largest container-terminal in Felixstowe, UK.
The four new Flirt trains purchased by Hungarian railway company MÁV-Start started their operation on October 16, while the new motor trains recently bought by independent Hungarian railway company GYSEV will enter operation in a few weeks.
Indotek Group member AMD-Services Kft. announced last week that the foundation stone of a new logistics centre in Nyíregyháza had been laid. The new, 5,000-square-metre facility, to be located near Road 4, will cost HUF 890 million (EUR 2.8 million).
The commercial port in Komárom will be renovated with an investment of HUF 1 billion (EUR 3 million).
In order to carry into effect the Jedlik Ányos Plan, established to promote electric vehicles in Hungary, as soon as possible, Hungary's Ministry for National Economy and the National Innovation Office have founded the Jedlik Ányos Cluster.
Last week we interviewed Ákos Kriza, Mayor of Miskolc, who says that although the training of professionals poses a great challenge, they will do everything to tackle the difficulties.
Industry
In August 2014, industrial gross output rose by 0.5 percent compared to the same month of 2013 and decreased by 5.7 percent compared to the previous month. In July, industrial output grew by 12.3 percent year-on-year and rose by 1.4 percent from the previous month.
A slowdown in the growth rate of the manufacture of transport equipment and the related supply branches as well as a decline in the food industry played a role in a production growth lower than in the previous months. After a significant year-on-year rise of 4.8 percent and 15.3 percent in July, domestic industrial sales increased by 0.3 percent, while exports rose by 2.5 percent from the previous year.
Industrial export increased by 11.4 percent in the first seven months this year and by 2.5 percent compared to the same period in 2013. The export of transport equipment manufacturing, accounting for almost one third of the export of Hungary's entire export volume, rose by 10.8 percent in August, reported the Hungarian Statistical Office (KSH).
Forint
On Friday morning, the forint declined against the most important foreign currencies. By Friday afternoon, the forint dropped to 307.31 against the euro. Last week, Hungary's currency was the strongest against foreign currencies on Monday (305.11 against the euro).
Downgrade
Fitch Ratings has downgraded several Hungarian banks. The downgrade of K&H's and EBH's Long-term IDRs was driven by a reassessment of the linkage between sovereign and bank credit risk in Hungary. As a result Fitch has capped bank ratings at one notch above the sovereign (BB+/Stable)," Fitch said in a statement on Thursday.
Fitch Ratings has downgraded Hungary’s Kereskedelmi és Hitelbank Zrt's (K&H) and Erste Bank Hungary Zrt's (EBH) Long-term Issuer Default Ratings (IDR) to 'BBB-' from 'BBB'. The Outlooks are Stable. Fitch has also affirmed CIB Bank Zrt's Long-term IDR (CIB) at 'BBB-' and revised the Outlook to Stable from Negative, reported Portfolio.hu.
Industrialization
The Government's aim is to increase the share of Hungary's industrial output in the local GDP to 30 percent by 2020 and as a result be the number one country in Europe in terms of share of industrial production in the nation's gross product, emphasised Béla Glattfelder, the Ministry for National Economy's State Secretary responsible for economy management. Glattfelder reminded that the EU target for its member states is 20 percent. With a share of 22 to 23 percent, Hungary has already exceeded this target, he added.
