Hungarian Supplier Bakony Muvek to Expand into White Goods Market
Apr 19, 2004
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Hungary's Bakony Muvek Rt, primarily a supplier of car parts, plans to expand and become a supplier of white goods makers such as Electrolux, CEO Gabor Zentai announced. The firm will spend HUF 2.5 billion (approx. U.S. $11.9 million) on setting up new production sites in Veszprem and Hajdunanas, and plans further developments worth HUF 6 billion (approx. U.S. $28 million) to 8 billion (approx. U.S. $38 million) during the next 2 years, he added.
Bakony currently makes car parts for Suzuki, Volkswagen/Audi and Mercedes Benz at its factories in Veszprem (western Hungary) and a plant in Germany acquired last year. The company will build a new plant in Hajdunanas (eastern Hungary) in a greenfield investment, and in the longer term, the latter is planned to become the center of white goods parts manufacturing, while the Veszprem factory will focus on car parts.
Bakony closed last year with a profit of HUF 173 million (approx. $829,000) on HUF 7 billion (approx. U.S. $33 million) revenues, and plans net earnings of HUF 256 million (approx. U.S. $1.2 million) this year, with revenues rising to HUF 8.4 billion (approx. $40,000). Steady growth is planned through 2007, by which time the company targets HUF 1 billion profits and HUF 17 billion revenues, Zentai said. Long-term plans are to reach turnover of EUR 100 million (HUF 25 billion) in order to remain competitive within the EU, he added.
The Hajdunanas project is planned to cost HUF 1.35 billion in the first phase, and HUF 2.2 billion overall. Construction is to begin in May 2004, with completion planned for October to November 2004, and deliveries to Electrolux to start from January 2005. Initially 150 jobs will be created, which is to rise to 350 after the second phase, the CEO said. In the first year, parts for 300,000 refrigerators are to be made, with the number rising to 1 million by 2007.
In a simultaneous project, the company will expand its capacity in Veszprem with a HUF 1.15 billion project to upgrade the current facility. After completion in August, deliveries to Electrolux's Swedish factories will begin in September. The headcount will increase by 80 in Veszprem.
Electrolux is currently building a new EUR 65 million refrigerator plant in Nyiregyhaza which plans to start production next year, and produce 560,000 units when production gears up by 2007.
Bakony plans to finance the projects from its own sources and bank loans, and also hopes to receive government support, Mr. Zentai said. (Interfax-Europe)
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