Mercedes-Benz has officially inaugurated the expanded production facilities at its plant in Kecskemét, marking the completion of a roughly EUR 1 billion investment that has transformed the site into the company’s largest manufacturing facility in Europe and its second largest worldwide.
New production hall makes Kecskemét Mercedes’ biggest European factory
The new production halls will significantly increase the factory’s output, with production capacity expected to double. The expansion also marks the start of series production of Mercedes-Benz’s first fully electric entry-level model, the new electric C-Class, at the Hungarian plant.
The opening ceremony was attended by Prime Minister Péter Magyar, Mercedes-Benz Group CEO Ola Källenius, and senior company executives, including Michael Schiebe, the board member responsible for production, quality and supply chain management, and Christian Dickert, Managing Director and Plant Manager of Mercedes-Benz Manufacturing Hungary.
Hungary’s growing role in Mercedes’ global network
Speaking at the ceremony, the prime minister described the investment as proof that Hungary is capable of hosting strategic industrial developments with long-term importance. He said the expansion would further strengthen the Kecskemét site’s position within Mercedes-Benz’s global manufacturing network while reinforcing its importance for the Hungarian economy.
According to Magyar, the government aims to provide investors with a predictable economic environment, competitive taxation, modern infrastructure and a skilled workforce. At the same time, he stressed that the partnership must be mutual, saying companies operating in Hungary are expected to comply with regulations, treat Hungarian employees fairly and increase the involvement of domestic suppliers.
Magyar also highlighted the government’s ambition to help more Hungarian small and medium-sized enterprises join international automotive supply chains through digitalisation, automation, artificial intelligence and supplier development programmes.
Tribute to Hungarian automotive pioneer
The prime minister opened his speech by recalling the story of Hungarian-born automotive engineer Béla Barényi, one of Mercedes-Benz’s most influential engineers and a pioneer of vehicle safety.
According to the well-known anecdote, Barényi famously told Mercedes executives during his 1939 job interview that they were “doing everything wrong” before outlining his vision for making cars significantly safer. Magyar said the story demonstrated not only Barényi’s genius but also the importance of leaders recognising talent and remaining open to new ideas.
Mercedes praises Hungarian workforce
Christian Dickert praised the commitment and professionalism of the Kecskemét workforce, saying the employees had demonstrated remarkable flexibility, dedication and teamwork throughout the expansion project. He described the new facilities as laying a solid foundation for Mercedes-Benz’s future growth and said he had been impressed by the expertise of the Hungarian team during his first months leading the plant.
Mercedes-Benz Group CEO Ola Källenius also highlighted customer focus, innovation and competitiveness as the company’s core values, adding that the Kecskemét factory embodies all three. Quoting inventor Alan Kay, Källenius said: “The best way to predict the future is to create it,” adding that the Hungarian workforce proves this philosophy every day.
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Major cost advantage over German factories
Mercedes-Benz believes the Kecskemét site will become increasingly important for the company’s future production strategy. Besides launching the electric C-Class, the expanded factory is expected to offer a substantial manufacturing cost advantage.
According to the company, production costs in Kecskemét are around 70% lower than at comparable German plants, making the Hungarian facility one of the group’s most competitive manufacturing locations in Europe.
The plant currently produces more than 100,000 vehicles annually, with long-term plans aiming to increase annual output to approximately 350,000 vehicles. The expansion further strengthens Kecskemét’s position as one of Hungary’s most important industrial centres and among Mercedes-Benz’s flagship production sites worldwide.
The live video of Péter Magyar arriving and delivering a speech at the opening can be watched below:
