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Automotive industry closing plants

March 28th, 2020

As all big automobile produces have suspended production in Hungary, the CEO off an important subcontractor of many of them warns that the coronavirus epidemic puts Hungary’s automotive industry in dire danger.

On Portfolio, Attila Szincsák, CEO of Denso Hungary, the local branch of a multinational producer of automotive systems and components suggests that without concerted efforts by producers and the government Hungary’s car manufacturers may end up crippled by the end of the pandemic. Thea were at first shaken by the interruption of the supply chain, since many basic components were produced in China where the pandemic originated from. He doesn’t believe that the current crisis will end globalization as such but thinks Western producers will have to diversify their supply chains in the future. Finally, production has stopped as demand was crumbling throughout Europe and the risk of contagion was too high along the assembly lines. As a result, all car producers in Hungary, including Audi, Suzuki and Mercedes are at a standstill and Szincsák urges the government to rescue small scale subcontractors who might not survive the crisis otherwise. He cannot predict how much it will take for the international markets to resuscitate after the pandemic, but the automotive industry which produces well over 10 per cent of Hungary’s GDP and its 130 thousand workers will need public assistance to bridge that period, Szincsák warns.

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