July 5, 2022

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Index – Economy – Could there be a platform for the Hungarian and Eastern European car industry?

The ban on the sale of explosive cars has never been well received in Central European countries – these countries are dependent on the auto industry. Lucia Mytna Kurekova, one of the leading economists of the Slovak government, exposed that “when Volkswagen sneezes, the whole of Slovakia will catch the flu.”

Czech Prime Minister Peter Fiala has described the EU’s green plan as a “threat to existence”. The country’s automakers also agree with his statement, but say it is only because the government is not ready to change. Due to the cheap skilled workers and the right infrastructure, car manufacturers have so far invested billions of euros in our region, establishing a large network of suppliers and manufacturers. About 10 percent of Czech GDP is generated by the automotive industry, which provides a livelihood for about 500,000 people. Slovakia is even more exposed to this sector, where it accounts for 14 percent of GDP. In Hungary Large car manufacturers account for 5-6 percent of Hungary’s GDP, but suppliers and service providers add another 8-9 percent.

Production lines need to be completely redesigned

If Eastern Europe does not adapt to the transition to electric vehicles in a timely manner, it could severely affect the industry. On the one hand, such a car has very few parts, and on the other hand, assembling them – for some reason first – requires less labor than assembling conventional cars. “The danger is obvious for countries that do not prepare in time,” says Daniel Harrison, an analyst at Automotive Manufacturing Solutions. According to him, backward countries will detect production leaks and fall behind economically and technologically. The recently formed Czech government promises to be ready to support companies.

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Government support will not be enough to expand the production of electric cars in the region. This would be detrimental to countries as car makers think about where to build electric cars. In addition, politics Information According to major car manufacturers in Germany, South Korea and Japan, it will be decided in the future which manufacturing centers will be converted exclusively to electric vehicle plants.

Competition in this field is fierce in Central Europe.

Spain competes with our region, which has spent nearly 14 billion euros (more than 5,500 billion Forindes) on electric vehicle production. In addition, as the country is already producing dozens of electric and hybrid models, its investment seems to be paying off and attracting significant new investment. In Central Europe, Slovakia is at the forefront, with nine models in production or in the design table.

However, only one model is made in the Czech Republic, Hungary and Poland.

To complicate matters further, the battery industry, by definition, is important to all car-producing nations. These factories form a kind of hub around which the network of suppliers of electric vehicles grows like mushrooms. They also determine where the production site will be, as car manufacturers prefer to avoid carrying hazardous materials such as half a ton of batteries over long distances.

The situation in Hungary

Based on our information from Audi Hungary, the brand is constantly changing its product portfolio to electric cars, and all new Audi models coming from 2026 will be electric cars. According to our information, the project

The company has been manufacturing electric drives since 2018 and is already preparing to produce next generation electric motors. In the future, electric drives for the Volkswagen Group’s fully electric models will be developed in Gior based on the premium electric platform developed in collaboration with Porsche. They also point out that the share of electric powertrain vehicles in their vehicle production continues to grow: the 100,000th hybrid car was completed in Gior last week.

(Cover image: John Voidas / Image Alliance / Getty Images)