UJHARTYAN, Hungary—Rehau Automotive has laid the ceremonial cornerstone of a $176.5 million exterior car components plant at Ujhartyan, near Budapest.
This 687,000-sq.-ft. facility, the company's second plant in the country, will manufacture bumpers and other parts primarily for Daimler, which is expanding vehicle production nearby.
Bavaria, Germany-based Rehau Automotive, part of the Swiss family-run Rehau group, marked the start of plant construction at a ceremony attended by Hungary's Foreign Affairs and Trade minister Peter Szijjarto.
His government earlier concluded a strategic partnership agreement with the group, providing state grant aid of almost $23 million toward the cost of Rehau's latest development scheme. Hungarian subsidiary Rehau-Automotive Kft. expects the completion of its new plant, scheduled for Spring 2019, will result in the creation of 652 jobs at Ujhartyan.
The new plant will be Rehau Automotive division's most modern and advanced operation, according to Markus Grundmann, chief executive officer of Rehau Automotive division.
Rehau's latest project is considered a major national investment and development by the Hungarian government.
"The government only concludes strategic partnership agreements with corporations whose activities have a perceivable effect on the Hungarian national economy. To date, (the government) has signed such agreements with 78 companies," Szijjarto said.
Those strategic partner companies employ a total of 175,000 people and have raised their ratio of Hungarian suppliers by 4 percent "representing tens of millions of euros increased revenues for Hungarian small and medium-sized enterprises", he added.
Rehau runs another production facility in Gyor, in northwestern Hungary. Operational since 2013, this unit supplies the car manufacturer Audi and is expanding to match the customer's growth at its local assembly plant.
The supplier's Gyor operation aims to turn out more bumper systems for Audi and is due to increase its 400-strong workforce by 75 in due course.