“Domestic small enterprises can also grow thanks to the operations of Hungary’s car plants, but the government must also contribute to their technological development”, Minister for Innovation and Technology László Palkovics said on Thursday in Budapest at the CEE Automotive Forum.

According to Mr. Palkovics, it is also better for major car manufacturers if they are able to work with domestic suppliers, but the latter can only be operated efficiently if they can enter the market of state-of-the-art industrial technologies through the application of automated systems. “For this reason, the government is also promoting the development of suppliers, for instance through creating opportunities for the transfer of knowledge, and the Supplier Development Programme, within the framework of which we have provided 9 billion forints (EUR 27 million) in funding to small and medium-sized enterprises to date”, he added.

According to the Minister, highly developed technologies can also counterbalance the international reduction in demand, since manufacturers’ primary response to market fluctuations will not be to reduce high-quality Hungarian production. He said that in his opinion there is also no need to worry about a possible downturn in the domestic automotive industry because, in addition to vehicle production, Europe’s largest battery production base is also being established in Hungary.

With relation to the development of the automotive industry, Mr. Palkovics mentioned that during the first eight months of this year the sector’s production value exceeded 6300 billion forints (EUR 18.9 billion), and compared to the similar period last year the industry employed 1.3 percent more people, a total of some 169.5 thousand, in the second quarter.

The Minister said he regards the development of production flexibility as the next phase of development of the Hungarian automotive industry, meaning that the plants operating here should be capable of producing vehicles with both traditional and electric drives. “Our development projects must include fuel cell technology and the storage of electricity in batteries, as well as the modernisation of internal combustion engines”, he stated.

Mr. Palkovics said he expects the ratio of the contribution of the automotive industry within the country’s gross domestic product to continue to increase. In reply to a question, he denied that there was any kind of delay in the construction of the BMW plant in Debrecen, in view of the fact that the project is going ahead according to schedule. “The construction of the ZalaZone vehicle test track is also not late; certain elements of the track can already be used now, prior to the project’s full completion”, he added.

(MTI)