ELECTRIC vehicle companies from Shenzhen have gradually taken root in Hungary, bolstering local economic growth and promoting the green transition.

“Companies in the battery industrial chain in Shenzhen, including BYD Group, Shenzhen Kedali Industry, Sunwoda Electronic, and GEM, have successively invested and opened businesses in Hungary, taking root where automaking is a key economic pillar,” said Chen Shou, president of the Shenzhen Battery Industry Association.

“This has significantly facilitated the restructuring of the Hungarian economy.” Being one of the first countries to join the Belt and Road Initiative (BRI), Hungary boasts strong ties with China. This, combined with the country’s infrastructure and tradition in automaking, has set the stage for further collaboration.

In Hungary, the automaking industry accounts for about one-third of manufacturing output, and nearly 90% of vehicles made in the country are for export, making up one-fifth of the total export value. Those vehicles are mainly sold to European Union (EU) member states, especially Germany, according to China Automotive News.

The Hungarian government proposed in 2016 a national strategy to shift toward electric vehicles to help contribute to the fight against climate change and global warming. The EU is also projected to ban new sales of carbon-emitting petrol and diesel cars by 2035.

Recently, the government announced a 90-billion forint (US$248.4 million) electric vehicle support program, providing subsidies for businesses to buy electric vehicles and build charging stations along national highways.

“Hungary hopes to partner with China in its green transition, especially in the field of electric vehicles,” said Gladden Pappin, president of the Hungarian Institute of International Affairs.

CATL, a leading global supplier of electric vehicle batteries and a strategic partner of Shenzhen, is building a 100-gigawatt-hour battery plant in Debrecen in eastern Hungary. It will be CATL’s second battery plant in Europe, following a facility in Germany. The plant, expected to be built in two years, will supply batteries to some 30 electric vehicle brands, including BMW, Mercedes-Benz, and Volkswagen, upon completion.

Noemi Sidlo, a spokesperson for CATL in Hungary, said, “While providing the best-in-class battery products to our customers, which will accelerate the transition to e-mobility in Hungary and Europe, the investment will generate substantial tax revenues, create new jobs, and become a new driver for the local economy.

“What’s more, CATL’s investment will also attract both upstream and downstream partners across the electric vehicle value chain to Hungary, thus injecting constant vitality into the country’s sustainable development.”

BYD also chose Hungary for its inaugural entry into the passenger car market in Central and Eastern Europe.

“The facility will be located in the northern part of Szeged, a city in southern Hungary, and is expected to start production by the end of 2025,” said Li Wei, vice-president of BYD.

The factory, occupying 3 square kilometers, is expected to produce 200,000 cars annually.

Li added that the initiative is crucial for the company to enter the global market and expand its presence worldwide.

In April, several battery companies such as Shenzhen Hello Tech Energy and Baoming Technology reached agreements with local companies during a visit to Hungary, the Shenzhen Battery Industry Association said.

“As China’s electric vehicles, power batteries, and related industries expand to Hungary and other countries participating in the BRI, a surge in local demand is anticipated. This will necessitate technological support and training of local talents, which we are ready to offer,” said Chen from the association.

(China Daily)