One employee who had worked for CATL for over a year was called back from China just to be fired. The decision surprised even local Chinese management, but some speculate the real reason is to replace Hungarian workers with cheaper foreign labour.

More than 100 Hungarians may lose their jobs

According to a report by Telex, more than 100 employees could soon be laid off at the CATL factory in Debrecen, the result of a top-down corporate decision. The round of layoffs is already underway. One affected worker said the reason was that in the “current market environment,” the company needs more Chinese professionals than Hungarian ones.

The terminations began last week, initially affecting employees still on probation. This week, the cuts extended to those with permanent contracts. Some of them had been with the company’s Hungarian subsidiary for over a year. The layoffs are impacting not just factory workers, but office staff, skilled labourers, quality inspectors, and process engineers as well. Chinese management has not provided the affected employees with a reason for the decision.

• Filipino workers continue to have access to Hungary despite no formal agreement

CATL was actively hiring until recently

Telex sent a detailed list of questions to the company regarding the reason and consequences of the layoffs, but had not received a response by the time of publication. The move is especially surprising because just a few weeks ago, CATL was actively recruiting new employees and offering the highest wages in the region.

Despite offering competitive pay, the company has struggled to attract workers. Resistance to battery manufacturing remains strong, and some employees leave shortly after being hired, spreading negative word-of-mouth and damaging the company’s reputation. These challenges may have led the Chinese leadership to stop recruiting locals for mid-level management and skilled positions.

The immediate cause for the downsizing may be that CATL is no longer expanding production as previously planned. Construction on the second plant unit has been suspended indefinitely.

• PM Orbán appoints minister responsible for suspending Hungarian citizenship

HUF 3 billion investment

In 2022, CATL announced plans to build a massive battery plant in Debrecen with an investment of HUF 3 trillion (EUR 7.5 billion), creating thousands of jobs in three phases and absorbing a large share of the local workforce. For now, only the first unit has been completed. Test production is set to begin this fall, followed by mass production in the winter. It’s still unclear how the current layoffs will affect the Hungarian government’s significant financial investment in the project.

The Chinese giant already operates a battery factory in Germany and plans to build a third plant in Spain. According to Telex, CATL has been one of the biggest global winners in the battery industry in recent years.

Read more about Debrecen HERE.

•  Job cuts and hiring sprees: What Hungary’s battery industry shake-up means for guest workers

To read or share this article in Hungarian, click here: Helló Magyar