The German car industry has invested billions in Hungary in recent years. Now the industry is running into problems there. BMW resorts to an unusual solution.
BMW production in Debrecen: German help in the Hungarian factory. Photo: BMW Group
BMW has been flying employees from German plants to Debrecen, Hungary, for months to train local workers for the production of the iX3 electric SUV and to compensate for staff shortages.
Production at the Hungarian plant runs in three shifts, with a capacity of 150,000 cars per year; The plant introduced three shifts in nine months as it ramped up.
BMW plans to cut up to 8,000 jobs in Germany by the end of next year, while production is being expanded in Hungary.
Debrecen now employs more than 5,000 people, but a shortage of skilled workers remains a problem, which is why BMW also hires Hungarian applicants without previous knowledge and trains them intensively.
The summary was created and editorially checked using AI.
Dusseldorf. The passengers on Lufthansa flight number 1600 had to be patient last Monday. More than an hour later than planned, the plane left Munich Airport and headed towards Debrecen. On board: employees of the local car manufacturer BMW.
The group has been sending employees from its German locations to Hungary and back several times a week for months. Corporate insiders report this to Handelsblatt. “Our people from Munich, other Bavarian plants and Leipzig are flying there,” says an employee representative.
One reason: Without the German employees, BMW cannot currently ramp up production at its flagship plant in Debrecen, Hungary, near the Romanian border. BMW builds the popular iX3 electric SUV at the factory. The people of Munich cannot find enough trained specialists locally.
Among other things, the German colleagues are flown in to train the workers on site. Some insiders speak of an even higher proportion of Germans in Hungary. “That’s a lot more than can fit on a plane,” said one decision-maker.
The planes that take off from Munich towards Hungary have been full lately, especially at the beginning of the week. Flights are usually fully booked on Mondays. According to Lufthansa, the Airbus 321 model aircraft can accommodate up to 200 passengers. BMW did not provide any information to Handelsblatt about the costs involved. It will probably be more expensive for the company.
Adopted homeland of Hungary
In recent months, the German auto industry has chosen Eastern European locations as its new home. While Volkswagen, Mercedes and BMW are cutting jobs in this country, the companies have invested heavily in Hungary in recent years.
Costs are one of the main reasons why the German auto industry has increased capacity in Hungary. The country attracted corporations with significantly lower taxes, duties, wages and energy costs than in Germany. According to data from the European statistics agency Eurostat, working hours in Germany are almost three times more expensive than in Hungary.
» Read also: “Eastern Europe is more attractive in all dimensions” – Premium car manufacturers are also relocating production
Mercedes is therefore doubling its capacity in Kecskemét from 200,000 to 400,000 units. This makes it the Stuttgart-based company's largest European work. Mercedes boss Ola Källenius, in the middle of the austerity battle with employee representatives, regularly points out the lower costs locally.
BMW ceremoniously put its youngest and most innovative car factory into operation there just over a year ago. Former BMW boss Oliver Zipse, who opened the first BMW location in Eastern Europe, had words of praise at the inauguration.
Until a few years ago, it was primarily volume brands such as Volkswagen that had developed Eastern Europe. Now premium brands such as BMW and Mercedes are also relying on low-wage countries. Mercedes speaks of a total of 70 percent lower production costs in Hungary than in Germany. CEO Ola Källenius said: “It is more attractive in all dimensions to invest in Eastern Europe than in Western Europe.” The country has attracted industrial capacity like no other in Europe.
Factory premises in Debrecen: Important location. Photo: BMW
How important Hungary is to the car companies is also shown by the scheduling of important supervisory board meetings. Both BMW and Mercedes have held meetings of their respective committees at their Hungarian plants in recent months.
Skilled labor problem became apparent
However, it is difficult for companies to find enough suitable skilled workers. The car companies sometimes have to invest a lot of money - as in the case of BMW - in order to create the personnel basis for their production. At Mercedes, too, highly qualified specialists or managers from the home country, so-called expats, train the new employees from Hungary.
The fact that numerous BMW drivers are flown to Debrecen has been the case for at least two years. When building the plant, the company needed the combined engineering expertise from its home country. It was already apparent back then that when the plant was completed, there would likely be a shortage of workers.
As early as 2024, there were hardly any qualified personnel to be found on the labor market in Debrecen. In addition, due to the war in neighboring Ukraine, their citizens were no longer available as skilled workers. Workers from Romania, not far away, were not politically welcome. The government puts Hungarian workers first, “which is why parliament has passed a stricter immigration law than ever before,” explains István Joó, head of the state investment authority HIPA.
Production in Debrecen: State-of-the-art BMW vehicle factory. Photo: BMW
As the Handelsblatt reported at the time, BMW sent a bus of applicants across the country. The group also hired Hungarians without much prior knowledge. The manufacturer has to teach them how to build cars. The first completed building on the factory premises was the apprentice training center.
And the fight for qualified Hungarians is likely to become even more intense in the coming years. Because of the threat of tariffs, Chinese automobile manufacturers are increasingly settling in Hungary. The BYD plant, the largest manufacturer from the People's Republic, in the southeast of the country is scheduled to start production this year. By the end of the decade, the group wants to have around 40,000 employees in Europe.
The IG Metall union responsible for the auto industry criticizes the increasing relocation of German companies to Eastern Europe. The density of skilled workers is an important argument for Germany as a car location, says a trade unionist.
In terms of population, Hungary is smaller than the home countries of BMW and Mercedes. Just under ten million people live there. In Bavaria there are around 13 million, in Baden-Württemberg around eleven.
High investments
Mercedes has invested one billion euros in the Hungarian plant over the past four years, and the Munich company has invested more than two billion euros. For the first time in the company's history, the manufacturer's products are rolling off the assembly line in Hungary. The factory is essential to the success of the group. And she works at the limit.
That's where the highly sought-after first models of BMW's new electric platform "Neue Klasse" roll off the assembly line as part of the largest model offensive in the company's history.
The factory in Debrecen has been producing the manufacturer's first “New Class” model, the iX3, since the beginning of the year. The model is popular: customers have already pre-ordered the car more than 100,000 times, and BMW has already delivered more than 30,000 units. Such demand is no easy feat for a plant that is ramping up. People in the corporate environment say that even in Munich some were “surprised” by the strong demand.
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The company wants to get out of the crisis with the “New Class”. The completely redesigned electric platform and the associated technologies are the basis for the upcoming cars. At the same time, according to company circles, BMW will cut up to 8,000 jobs in Germany by the end of next year. However, this only affects “indirect areas”, i.e. not car production.
Three shifts in record time
Series production of the model started around a year ago. Within nine months, BMW introduced three shifts, a record for a new BMW plant. We work around the clock in three shifts to assemble the models for European customers. According to the company, the factory can produce 150,000 cars per year. An expansion in Debrecen would at least be spatially feasible. A total of twice as much production could be achieved on the site of the factory. But that probably also depends on the personnel situation.
BMW points out that the temporary deployment of international employees is already planned when new plants or products are ramped up. This was already the case when the plants in Mexico and China were set up and ramped up. The company is pursuing two overarching goals: the qualification and empowerment of the workforce on site and also the transfer of knowledge back to the production network. According to the manufacturer, the intensity varies depending on the maturity of the location.
The plant in Hungary is particularly relevant for the group. The group speaks of a “pioneering role”. For the first time, BMW is building a car there based on the new “New Class” electric architecture. Employees from other car factories are temporarily working in Hungary to familiarize themselves with the new production systems and facilities.
“All in all, the Debrecen plant benefits from the knowledge of the global production network and at the same time provides important insights for the introduction of the New Class at other production locations,” says BMW. Given the rapid and global parallel ramp-up of the new class, the transfer is extremely important.
According to BMW, more than 5,000 employees now work at the Debrecen site. The DAX group does not provide any information on “more in-depth employee data”.
Production of the 50,000th iX3 in Hungary: The model sells well. Photo: BMW
According to Munich Airport's plans, Monday operations will continue until mid-March. As usual, the planes take off to the east at 6:30 a.m. and 11:30 a.m. The remaining flights from the Bavarian capital to Debrecen will also continue to operate. Currently, BMW employees land at Debrecen Airport almost every day of the week.
This keeps the frequency high. According to the plans of the airports in the three cities and data from the Flightradar 24 portal, Debrecen was flown to six times from Munich and Leipzig in the week of October 5th alone.
Conversion, ramp-up and new models in Germany
Parallel to the ramp-up in eastern Hungary, BMW is currently producing less in some German plants. But this is not just due to lower demand for some models.
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The Munich factory is currently ramping up production of the new “New Class” electric sedan, the i3. The employees had also demanded this at the time. Because working hours cost significantly less in Hungary than in Munich, the main plant should at least remain technically competitive.
Dingolfing was awarded the contract for its combustion engine counterpart, the 3 Series, in order to ensure good capacity utilization. According to its own information, the car manufacturer has invested a good two billion euros in the capacities of the new 3 Series. The factory in Leipzig went into summer break for a few weeks in the summer to prepare it for the production of the “Neue Klasse”. The fully electric version of the 1 Series is likely to roll off the production line there in the future.
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