Daimler to idle Mercedes plant in Hungary for a month

Europe

BUDAPEST — Daimler will idle its Mercedes-Benz plant in Hungary for a month starting on Monday, extending a regular end-of-year maintenance period due to a global component shortage.

“Adjusting to the continuously changing component supply situation, the Mercedes-Benz plant in Kecskemet will modify its production plans from calendar week 50,” Daimler said on Saturday.

The company will use the stoppage for maintenance and reconstruction works at the plant in central Hungary, which employed about 4,400 people last year and launched production of the EQB full-electric model in late October.

Workers would be paid base salary and benefits during the production halt which will run until Jan. 12, Daimler said.

The Kecskemet factory, which built more than 160,000 cars last year, has faced disruptions this year due to a supply crunch which has weighed on the car industry, a mainstay of Hungary’s growth.

German rival Audi and Japanese carmaker Suzuki, which also have factories in Hungary, have faced disruptions this year.

A global shortage of semiconductors, due to supply problems and a surge in demand for consumer electricals during the pandemic, has hit the auto industry hard, with millions of vehicles worldwide not being produced because important parts are missing.

Disruptions to car manufacturing have a significant impact on Hungary’s industrial output, which fell by an annual 3.4 percent in October and 2.3 percent in September as car sector output fell amid the chip shortage.

BMW plans to open a new factory in Debrecen, Hungary, in 2025 to build cars underpinned by its electric-focused New Class architecture.

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