BUDAPEST—Hungary is set to host another major automotive manufacturing expansion as Germany-based Rehau A.G. plans to build a new $184 million exterior car components plant near Budapest to serve growing Daimler production locally.
Hungarian offshoot Rehau-Automotive Kft. intends to build the 678,000-sq.-ft. facility to produce vehicle bumpers and other external parts, in Ujhartyan. Construction begins in March 2018 and the plant is set for completion in April 2019, according to the Rehau, Germany-based company.
Details of the company's latest plan were unveiled at a joint news conference with the Hungarian government in Budapest on Feb. 20.
The greenfield investment, expected to create 727 new Rehau jobs, has received a significant financial boost with a state grant of almost $28.3 million, Hungary's Foreign Affairs and Trade Minister Peter Szijjarto pointed out at the news conference.
He stressed this support is the third largest investment of its kind under the current Hungarian government term since 2014.
"The auto industry is the flagship of the transition to the digital age, so that this country, which is competitive in the sector, will be competitive in the economy of the future as a whole," Szijjarto said according to national press reports.
Rehau's Hungarian subsidiary, based in Gyor, also is expanding its existing automotive parts manufacturing operation there. The plant serves Audi vehicle production at its local assembly plant and it responding to the car builder's own expansion of capacity.
The supplier aims to extend bumper systems production at its facility and plans to raise its current 400-strong workforce by 75. Audi just announced it intends to establish a new $24.5 million research and development center in Gyor with a government grant amounting to a fifth of the investment.
Rehau first launched the plant in Hungary in 2013 to mold and supply the nearby Audi plant with bumper systems for the manufacturer's TT and Q7 car models.