Tesla Motors car assembly plant in Hungary? Oh, really?

Hungarian government propagandists have a new strategy – they plant fake, “feel-good” stories about the economy in the media. Recently articles appeared that Hungary’s debt upgrade is “imminent” and would be well-deserved. Keeping the country’s debt in “junk” is unfair.

Portfolio.hu published an elaborate story about the government’s efforts to attract Tesla Motors, quoting Péter Szijjártó, Minister of Foreign Affairs, that Hungarian diplomacy is developing a relationship with the innovative car manufacturer. (Read here the Tesla story.)

Tesla

Tesla

Ms. Réka Szemerkényi, Hungarian Ambassador to the U.S. already visited Tesla’s HQ in California. Hungary’s Ambassador in the Netherlands met the head of Tesla’s European assembly unit and she learned from “delicate hints of the management” that Tesla is planning new cheaper models and may set up a new assembly or manufacturing unit in Central Europe. Hungarian diplomats already figured out that Hungary, thanks to its geographical location, would be “a logical choice” and there is a “realistic possibility” that the need to a new plant may arise in 2016.

Mr. Szijjártó ordered Ms. Judit Czakó of the Consulate General of Hungary in New York, to organize a “targeted company visit” in view of expectations that Tesla may start looking for host countries for a potential new manufacturing plant in early 2016. There would be “multiple benefits” if Tesla chose Hungary, the plant would not only create jobs, but it would also give local e-mobility and electric car usage a boost and medium-sized companies are just waiting for such a great opportunity.

Ms. Judit Czakó of the Consulate General of Hungary in New York supposed to organize a “targeted company visit” at Tesla Motors.

Ms. Judit Czakó of the Consulate General of Hungary in New York is supposed to organize a “targeted company visit” at Tesla Motors.

There is only one problem with the story. Tesla has not indicated any investment plans in Hungary, not even a hint from the company that they are interested!

Tesla is close to California’s Silicon Valley and its open and tolerant culture is light-years away from Hungary’s authoritarian regime. High-tech companies are leaving Budapest as fast as they can, and manufacturing cannot find suitable labor since educated people are emigrating.

Apollo Tyres of India is building a factory there and they are having difficulty finding qualified staff; foreign investors were misled when they were told about abundant cheap and well-educated labor. Hungary’s educational system has collapsed and skilled workers left for more lucrative pay in other parts of the EU. “The people with several years of experience that you would readily hire are just not there in the labor market for now,” said the Head of Human Resources at Apollo Tyres. (Read more here.)

Hungary’s rampant corruption and its toxic mix of nationalism, institutionalized racism and anti-Semitism have created an unfriendly political and business environment. Rating agencies are unwilling to upgrade the county’s debt from “junk” citing “opaqueness” in finances, a reference to Hungary’s out-of-control crony kleptocracy. The government needs to change its policies and follow some of the suggestions outlined by US Ambassador Colleen Bell’s recent speech at Corvinus University.

Childish communication tricks won’t bring new US investors to Hungary – only policy changes will.

György Lázár

30 Comments

  1. Avatar Miklos Banfi says:

    Undoubtably it would be a huge boost to the image of the government if Tesla, with its very high reputation decided to set up business in Hungary, but as Mr. Lázár pointed out the chances are very bleak.
    The exodus of the quality workforce has a tremendous negative impact on the economy, which is very hard to quantify, but I don’t think it is hard to realize the effect not only on the present, but unfortunately the future seems destitute in this regard. This is bad news, because even after the inevitable fall of this political regime the state of the country will face serious hardship to recover.

  2. “Hungary’s educational system has collapsed….”

    Really? Let’s try and report in a realistic fashion shall we?

    • Avatar Christopher Adam says:

      Mark G,

      When the central administration in charge of overseeing all public education fails to pay utility bills in local elementary and high schools, leading to the electricity being cut and classes cancelled for days, then the system has, indeed, collapsed.

    • In addition to what Chris stated about utilities not being paid, my cousins children have still as of the Easter weekend have not recieved 3 out of 6 of their text books for the year. The year is almost OVER!!! The teacher struggles to make photo copies of crucial pages in her book because there is not enough paper supplies and toner in copiers to accomodate their increased usage because of the text book issue and google of all things is their only saving grace……at least for those who have an internet connection and computer device! I would say that the education system has collapsed.

  3. Its not hard to imagine yet another auto manufaturer setting up shop in Hungary. It is a very well established auto manufacturing hub already with the likes of Mercedes Benz recently announcing expansions in the country. Its a natural fit for Tesla.

    As for people leaving Hungary, well thats no surprise. A catch 22 has developed. Industrialized countries like Germany need stratigic locations and a cheap educated work force both of which Hungary has. The cheap educated work force however wants more pay so they tend to go where the pay is higher aka Germany. None of this is surprising. Happens all over the world.
    What can the government do in these cases??? If you force higher wages the companies leave. If you dont allow free travel and keep your citizens captive well…….your not a democratic country anymore.

    Please elaborate on some concrete solutions that make sense instead of simply whining about how things are not working.

  4. “High-tech companies are leaving…”
    Can you pls provide some examples.

  5. @Varga z
    Hungarian GDP/head, wages & disposable income have been falling behind in the region, emigration is the highest, education tests results deteriorating.
    In 2010 Orban promised radical improvement in all these areas, Hungary to became the European “engine”, “hub of manufacturing” and other preposterous nonsence.
    Now does he influence these or not? Pls sync with the agitprop dept, it’s confusing.

  6. In true Democracy politics is let to the people to decide through elections and companies do not throw their weight to go against just that, Democracy.
    Any proof to what you are mambling about…?
    I think the author should enjoy what he has received from the host country and accept differences and understand that a unipolar world can not exist.
    Democracy starts with acceptig differences and not dictatig what to do.
    Hence the root of the word, when you are dictating you are a Dictator.

  7. Generally speaking when the investors outsourcing the production or assembly works are not really interested in the country’s educational system, rather in cheap slave labor forces that are reliable and credible guaranties from the government that they will help them exploiting their own citizens. If they were interested in the education success of the country China had never been chosen for outscoring.

    Hungary is popular for the Hungarians are much more intelligent (this job kind of jobs don’t require educated ones) more teachable than many others, can be trained, more obedient and submissive i.e. less rebel and even if they rebel they normally never take anything to final success they give it up or break down in the middle.

    Also, Hungary as passage country will always provide even cheaper and under educated labor forces from either neighboring countries or immigrants. They don’t really need only Hungarian labor force. See why the Suzuki factory was located just there.

    As for tire or rubber companies in general that is the lowest level of the industry both in payment and employment policies and they rather interested in cheap prices of energy carriers as it has a high energy consummation, gas or electricity.

  8. @observer

    You are stating exactly what I said. Hungary is a source of cheap labour as intended (don’t kid yourself, Germany doesn’t want competition they need a cheap labour and easily accessible markets for their wares). Hungary IS and will continue grow as a manufacturing hub because of this. If it stops being a source of cheap labour it stops being a hub of manufacturing.

  9. Avatar Robert Szucs says:

    Hungarian free press is a dirty Hungary bashing paper with it’s Hungary heating writers Lazar, etc. with Hungarian names.
    Are you guys jealous? Wan’t to repatriate? What is the cause of this constant anti Hungary sentiment?

    • Do you equate Fidesz and the government to Hungary and Hungarians? Is Hungary defined by the type of government it has? Are Hungarians defined by the type of government it holds? The Hungarians here whether they are expats, descendants of Hungarians or Hungarian citizens, absolutely love Hungary and the Hungarian people. What we have a problem with is the government. So how does this make us Hungary hating and anti-Hungarian? Pull your head out of your ass as the lack of oxygen is preventing you from seeing and thinking clearly.

  10. Varga Zoli
    on March 28, 2016 at 12:01 am

    Well, there are other viewpoints too, such as tax relief, ownership of the land where their production line is hosted, real estate prices, transport and supply fees, price of energy carriers, effectiveness or more exactly the non-effectiveness of the labor union, human right issues, currency exchange rates, the strength or the weakness of the local currencies, corruptibility bribeability of the government, HR policies, i.e. they wouldn’t need to exclusively employ Hungarian labor forces if they can cut a deal and can bring cheap labor forces from other countries like Suzuki Hungary planned to fully replace all the Hungarian workforce with blue-collars from India. And there are many more.

    Labor force, humans are tissue paper that they are pulling out from the box one after another. All disposable. They are the easiest to manipulate and toy with them especially after bribing or blackmailing the government. Remember how Orban caved in to Merkel when she visited Hungary and gave him order about how to behave with companies in German interest? A few days later Putin came as they coordinated with Merkel and Orban caved in again.

  11. Some comments here clearly reflects typical comprehension issues, or tryig to disorient the conversation according to the usual guidelines.

    For your information, what you read above isn’t driven by “anti Hungarian sentiments” – in my opinion rather by a concern about Hungary – but a honest”anti bullshit” sentiment.
    A rather unfortunate coincidence that the two in the way to converge, and pretty soon become interchangeable if it goes on much longer.

  12. @Richard

    We’re beating a dead horse. All the factors you mentioned ei: real estate, taxes etc…..are obviously all very compatible with major manufacturing companies financial strategy or else they wouldn’t be in Hungary.
    As for Indian workers taking over all operations at Suzuki, well Im not sure where you got that from. I can only assume you’re reading way too many Hungarian free press articles.

    Also, Merkel doesn’t need to tell Orban how to behave towards German companies. Like I have stated before – keep labour (yes taxes etc…) cheap = keep attracting manufacturing companies
    Increase costs for companies = bye bye manufacturing.

  13. These intolerant, racist and self-serving manipulators do their best to damage the reputation of Hungary. Move back to Hungary, work hard and make the country a better place if you worry so much about it! I assume, you rather find it easier to criticize others from thousands of miles? Stop distorting and exaggerating facts!!! As far as I know Canada is not a perfect place to live, either. Try to find something useful to do there, there is a liberal government after all.

  14. This website is anti-Hungarian, because instead of wanting the best for Hungary and being proud of being Hungarian it wants us to become another puppet for the one world order.
    Do these authors really

    • It is so embarrassing to the Hungarian people to have so many that have fallen for the propaganda. Let me ask you a question, do you think that so many would be in the west if there was such great opportunity in Hungary? Do you think that Hungarians worldwide should simply be proud Hungarians at all times even when they see their homeland is going to hell in a handbasket? Who is the puppet here?

  15. This website is anti-Hungarian, because instead of wanting the best for Hungary and being proud of being Hungarian it wants us to become another puppet for the one world order.
    Do these writers really attempt to say that they feel Hungarian?

    • @sinx,

      The “one world order” is a code word, a pseudonym. That’s how they deflect attention away from the reality that “one world order” has actually already been here and exists for thousands of years or more. That’s a game, that’s the name of the game, they say “fight against the one world order” i.e. please don’t notice that we live in a one world order that has been keeping humankind in slavery, misery, disease, in plagues and in wars and in continuous terrible trauma for aeons. Yes, they do and they give you this smokescreen to believe it hasn’t come yet, you can fight against it i.e. make you believe you can be free. No, never. They don’t want you to notice it and they want you to fight against something imaginary that hasn’t come yet instead of realizing and fighting against what is here crippling you now. There is a war for the control of the planet but it is not for freedom and for your benefits it’s nothing more than the Asian gangsters want to take the helm from the present gangsters.

      “None are so hopelessly enslaved, as those who falsely believe they are free. The truth has been kept from the depth of their minds by masters who rule them with lies. They feed them on falsehoods till wrong looks like right in their eyes.” – Johann Wolfgang von Goethe

      As of the writers. They do what they have to do and in what they believe. That’s their life and this is our life. There’s nothing wrong with it. You don’t have to believe everything, you can connect the dots. You can see and you can let us know what you are seeing.

  16. Good job using half-truths and distortions, in order to support your propaganda. Fact is however that it will take a very long time for Hungarians to forget the economic disaster ushered in by the Socialists in the 2002-2010 period. Article mentions how many Hungarians left for the West for higher pay. That is most certainly true, but: 1) It is a regional trend, and there is no government in the region which was able to find a solution. 2) Hungary’s problem has been exacerbated by the economic disaster of the 2002-2010 period. It was a period when Slovakia for instance, which had same GDP/capita same as Hungary in 2002, by 2010 ended with a GDP/capita that was 30% higher than Hungary’s, while Hungary’s government debt levels reached 82% of GDP, making it hard to start catching up the lost ground. Since 2010 however, Hungary at least has not lost any more ground and the debt/GDP ratio is in fact improving. Now imagine what a difference it would have made today in Hungary if wages would have also been 30% higher, and government spending would have been 30% higher, making it possible to spend more on education, health care, infrastructure and so on. There would still be some people leaving Hungary for higher wages, just as they do from Slovakia, but the outflow would not be as great. Fact is that it was the Socialist government’s legacy of near-bankrupting the country and its citizens with its policies which is at the root of most of Hungary’s woes. Hungary is now in the process of digging out, which will take a lot longer than it did to dig in, especially within the context of today’s stagnated global economy, and more specifically the stagnated European economy.

  17. “Do you think that Hungarians worldwide should simply be proud Hungarians at all times even when they see their homeland is going to hell in a handbasket? ”
    —————————
    Yes, definitely!!!!!!!!! They should simply be proud of being Hungarians at all times and then Hungary wouldn’t go to hell. There are so many small countries and ethnic groups in the world living in truly miserable circumstances yet they can afford being proud of their achievements even if modest, their origin, their roots, their ethnic belonging and their lives, culture and history. Even gays can afford being proud of what they are and they lifestyle and achievements in human rights.
    That’s about human dignity that everyone has the right to possess and enjoy.

    Hungary is obviously not the most successful country in the world but there are many more worse, even the U.S. the world’s big boy is at the verge of total economic collapse.

    Criticism is certainly welcomed together with encouragement from true, nice, and warmhearted people, but pouring cold water on them rather speaks about the those who do it than about those who have to endure the degradation.

    Yes, they can be proud of being Hungarians, people can be proud of being Eritreans, Jews, yellow, black, and white, being gypsy, aborigine, poor or whatever they are whatever God gave them.

    We are not talking about what can be discussed, their actions, what they do, but we speak about what they are!!!!!!!!!!!!!!!!!!!!

    They are Hungarians, Hungary needs help.

    • Yes Richard, I would expect you to be one of those that would accept anything the Hungarian government does, simply because you would be too proud to admit when something is simply not ethical. I love Hungary, I love my fellow Hungarians all over the world, I do not love the government of Hungary and this is okay. I don’t think it is nesessary to overlook all wrongs simply because I am Hungarian. That is not okay. Nice try Richard the asshole. Go twist someone elses words.

      • I didn’s say to be proud of the government but be proud of being Hungarian. Problem with speech understanding again. In your previous post you it was just you who encouraged posters to make difference.
        And all your posts to others too is around the ass.
        Please stop it you barbarian.

  18. Avatar Andras Petch says:

    This portal is full of anti-semite and anti-Hungarian writers. Such journalist should be sidelined.

    Hungary is the single turn around story in EU after a near bankruptcy and IMF bail out in 2009. Debt is shrinking, deficit is low, unemployment is droping, inflation is low.

    Your kind of people hates everyone who stands out and achieves great things. You simply don’t want them to succed. You are haters. Typical anti-semites.

  19. Liz Aucoin
    on March 29, 2016 at 9:49 pm

    You wrote:
    “Pull your head out of your ass as the lack of oxygen is preventing you from seeing and thinking clearly.”

    One of the reason some people take this site for a Hungarian bashing publication is just you and your unbearably filthy manner, your low language, you plebeian, ordinary, vulgar, coarse and bossy style coupled with constant word twisting and useless, meaningless verbalism.

    Not for the first time, your vocabulary “shut the f@ck up, asshole, pull your head out of your ass” just to mention a few ones from your posting history is what certainly lowers the standard of this board more than a few commenters expressing their disagreement.

    Please go find a soap and treat your unwashed big dirty mouth for the benefit of this publication. Until then, or in case you should have difficulties understanding that even bossy Liz must toe the line, please take your very own advice and do you what you advised to others in order to get some more oxygen.

    • Okay, I’ll tone down my “filthy mouth”, however all the other crap you spewed is just a joke. You desperately need a mirror.

      • It’s good you tone down your filthy mouth and keep it down. Now, you only have to stop printing out your frustrated personal offenses and stop putting words I never said in my mouth and then accusing me with word twisting and instead focus on the topic.

        And you can make sense for all of our benefit. You are not that bad when minding or discussing the topic. Try it please.

        Thank you.

        • I have no problem discussing a topic Richard. What I have a hard time doing is holding back from calling you out on your crap. Especially when you, like a bull in a china shop expect all other commenters to see things your way and when they do not, you start insulting them. I have no tolerance for people like you. All I am promising you Richard is that I will tone down my language. So before advising me as to how I should comment. Check yourself.

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