India's Apollo Tyres is to build a HUF 146 billion plant in Gyöngyöshalász, Hungary, creating 975 new jobs. State Secretary of the Hungarian Ministry of Foreign Affairs and Trade Péter Szijjártó said the investment is a key element in the Hungarian Government’s reindustrialization plan. The plant is expected to produce 16,000 car tyres and 3,000 tyres for light commercial vehicles a day.

Managing Director of Apollo Tyres Mr. Neeraj Kanwar said the plant in Gyöngyöshalász would complement production at Apollo Tyres' Netherlands unit, as demand for tyres is constantly rising throughout Europe. The facility is going to produce Apollo and Vredestein tyres for the European market, including Russia and Turkey.

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State Secretary Szijjártó underlined that due to the recent shift in global economic power, the most dynamically growing markets are now in Asia, and therefore it was the right choice for the Hungarian Government to announce the ‘Opening to the East’ strategy. One of the main objectives of this initiative is to attract as much Asian investment to the country as possible, for which there is a fierce competition among European countries. For instance, in 2008, 11 countries were vying for the Apollo contract. Attracting Asian investors is a priority for Hungary as they contribute to two strategic goals of the Government: become center of production in Europe and attract as many R&D&I funds as possible.

Péter Szijjártó reminded that Apollo currently has six factories worldwide, from which one is in Europe, the Netherlands. The Hungarian plant will be the first green field project of the company in Europe. Apollo has been a long-term supplier of car manufacturers such as Daimler, Tata, Volkswagen or Suzuki. For the HUF 146 bn (EUR 470 million) investment, the Hungarian government grants Apollo a cash investment subsidy of HUF 16 bn (EUR 50 million), which has already been approved by the European Commission. The plant will help Hungary to reach its goal of employing 5 million people and expanding the export.

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Vice President of Apollo Mr. Neeraj Kanwar said Apollo had considered a number of countries for the investment, and the government subsidy was a great plus. He added that the company would invest HUF 146 billion in Gyöngyöshalász within five years. Apollo Tyres plans to tap into local talent and cooperate with institutions of higher education in the area of research and development.

According to Apollo Tyres, the process of getting permits for the investment is to start soon, as is the environmental impact study. Construction of the plant is expected to start in the spring of 2015, and the first tyres could roll off the production line in early 2017. Combined daily production of Apollo plants around the world is approximately 1,700 tons. Turnover of the company was EUR 1.64 bn last year, with a staff of 16,000 people.

(Ministry of Foreign Affairs and Trade)