Mercedes will develop two new electric vehicle platforms, enabling it to produce higher-end and value-added models at the plant.

The government is supporting the investment, which will require significant infrastructure developments and create new jobs, with a 14 billion forint grant, the minister said.

The government will also contribute to a training programme to be launched by Mercedes in Kecskemét, he added.

Szijjártó said Hungary was proud to be considered a key base by Mercedes, calling the country and the manufacturer’s 14-year partnership a “success story for both sides”.

Mercedes’ latest investment shows that the Hungarian automotive industry is booming, Szijjártó said, noting that the sector’s output grew to 9,400 billion forints last year from 3,600 billion in 2010. And it has not lost any momentum, he said, arguing that the auto industry output came to a record 4,500 billion forints in the first five months of 2022.

Hungary’s automotive sector employs 155,000 people, with 90% of its output produced for export, Szijjártó said. And though Hungary is ranked only 95th by population, it is the world’s 20th largest auto exporter, he added.

The government has worked hard to make Hungary “one of the most important locations of the global auto industry revolution and the transition to electric vehicles”, Szijjártó said.

Hungary is the third country in the world, besides Germany and China, to house plants from all three top German carmakers, he said.