Hungarian company becomes IKEA’s new manufacturing partner

Online daily Behir.hu reports that a new factory plant was opened in Szarvas, where 1 million lamps will be manufactured for IKEA on a yearly basis. As a result of the almost 2 billion HUF (6.42 million EUR) investment, the manufacturing company, Szarvasi Vas-Fémipar Zrt, was expanded by a 4 thousand square metres big plant.

The factory in Szarvas was opened in 1952 and has been a fully Hungarian-owned venture ever since. They have started producing coffee machines in 1970, lamps in 1972. There are altogether 420 people employed there, two-thirds of them in the lamp section, while the remaining one-third work in the coffee machine manufacturing section. Szarvasi Vas-Fémipar Zrt’s main profile is lighting, which got a separate plant thanks to a deal made between the Hungarian company and the Swedish furniture-trading company, IKEA.

The Hungarian company made a partnership agreement with IKEA in 1996. Recently, they applied for becoming the sole producer of a particular type of lamp, and so they will take over production from a Chinese company. According to business daily Heti Világgazdaság, 20 thousand lamps are produced at the Hungarian plant each week.

By the time summer arrives, Szarvasi Vas-Fémipari Zrt will be IKEA’s exclusive supplier concerning this lamp.

Gergely Gáspár, the commercial director of Szarvasi Vas-Fémipari Zrt, announced at a press conference that the reason for this investment was to initiate a project: IKEA is going to introduce a new line of household products, where they require from the Hungarian company the production of 1 million lamps per year. All of these lamps are quite complex, as they are made up of 100 million tiny pieces.