The Hungarian Government will initiate a dialogue with the German car manufacturer company Opel and its new owner, the French PSA Group, in order to maintain or further enlarge their capacity in Hungary, the factory in Szentgotthárd, Minister of Foreign Affairs and Trade Péter Szijjártó told the Hungarian news agency MTI after his meeting with Opel’s executives held at the company’s headquarters in Rüsselsheim.

In his interview given by telephone, the Minister highlighted that it will be necessary to maintain ongoing consultations between the Government and the new owners, and there is „full openness and readiness” on the part of Opel to engage in such talks.

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PSA, manufacturing Peugeot, Citroen and the DS model family in the premium category, will honour the contracts and agreements concluded by the former owner, the US General Motors (GM), but will review all further development plans, and will adopt the relevant decisions at a later point in time, Mr Szijjártó said.

The Szentgotthárd factory is Opel’s largest European engine manufacturing plant where a record number of engines – 630,000 – were made last year, and the company has extremely positive experiences regarding Hungary, the Minister underlined, reiterating that the first Opel Astra left the production line 25 years ago.

The measures implemented by the Hungarian Government with a view to enhancing competitiveness, including the tax reductions and the development of technical training, help Opel to continue to retain a competitive production base in Hungary. The Government will seek to maintain even closer relations with the company and its new owner in the interest of the maintenance and further enlargement of its production capacity in Hungary, the Minister added.

The ongoing enlargement of the automotive industry which accounts for 30.5 per cent of the country’s industrial production is a prime interest of Hungary, and the Government will therefore „extend all assistance and support” to ensure that Opel may continue to maintain its activities in Hungary under competitive circumstances, the Minister of Foreign Affairs and Trade said.

During the course of his visit to Hesse, Mr Szijjártó had talks, inter alia, with the executives of Commerzbank and Henkell & Co. Sektkellerei, the leaders of the state chamber of industry and commerce, Volker Bouffier, Minister President of the State of Hesse, and Norbert Kartmann, President of the state legislature (Landtag). He said regarding his talks that the Hungarian Government’s economic policy is received very positively in Hesse, and the economic actors “confirmed absolutely positively” the decisions that serve to further reinforce the competitiveness of the Hungarian economy, including the reduction of the social contribution tax and the corporation tax.

Hesse is Hungary’s fifth largest trade partner among the federal states of Germany. The volume of bilateral trade exceeded EUR 3.3 billion last year, and there are already 54 businesses from Hesse which have investments in Hungary, the Minister said.

He highlighted: they agreed with his negotiating partners, inter alia, that the EU should create legislation which does not place the protection of the environment before competitiveness. Stressing the principles of environmental protection and competitiveness is particularly important in the automotive industry as “radical measures are being implemented in several places around the world in the interest of enhancing competitiveness, and we, too, must follow suit”, Mr Szijjártó pointed out.

He added: the parties also agreed that an agreement must be concluded with respect to Brexit – the termination of Britain’s EU membership – in the wake of which economic, trade and investment relations will remain as close as possible between the European Union and Britain.

The agreement on the construction of the Szentgotthárd plant was signed by the representatives of the Hungarian Government and Opel in July 1990. Passenger cars were made in Szentgotthárd between 1992 and 1999: 80,835 Opel Astras and 4,404 Vectras were manufactured in the factory which employs more than 1,200 workers at present.

Prime Minister at the time József Antall drove the first Hungarian Opel Astra off the production line on 13 March 1992.

Parallel with the production of cars, engines and cylinder heads were also manufactured for Opel’s models at the site. In continuation of the developments, one of the world’s most modern, flexible engine factories was inaugurated in 2012, by virtue of which the value of investments made in Hungary rose to EUR 1.4 billion.

More than nine million engines were made from July 1992 up to the end of 2016, and almost seven million cylinder heads have been made since 1997.

Opel’s dealership network sold more than 415,000 new vehicles over 25 years.

GM announced last week that they are selling their European interests, including Opel for EUR 2.2 billion (USD 2.33 billion), to the PSA Group.

Photo by Ministry of Foreign Affairs and Trade