5/16/2019

BMW Affirms Plans for Assembly Plant in Hungary

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Hungary’s central government says it has been assured by BMW AG that the carmaker will begin construction later this year of a €1 billion assembly plant in Debrecen and begin production by 2023.

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Hungary’s central government says it has been assured by BMW AG that the carmaker will begin construction later this year of a €1 billion assembly plant in Debrecen and begin production by 2023.

The facility, which was announced last July, will be BMW’s first new facility in Europe in 20 years. The factory will be able to build 150,000 vehicles per year. Handelsblatt reported last weekend that there have been internal discussions at BMW about whether to delay the facility because of a global slowdown in sales.

Earlier this month BMW reported that its net profit plummeted 74% in the first quarter as unit sales stalled and revenue dipped 1%. The company also blamed a €1.4 billion set-aside to cover expected fines by the European Union regarding claims that German carmakers conspired to hamper development of emission control technology.

Similar concerns about a slumping car market have prompted Daimler AG to postpone a project to expand the company’s small-car plant in Kecskemet, Hungary.