Brussels, 17/07/2009 (Agence Europe) - On Thursday 16 July, the European Commission authorised aid of HUF 29.7 billion (€111.5 million), which the Hungarian authorities intend to grant to Mercedes-Benz Hungary. The car manufacturer, owned by Daimler AG, wants to build of a new car manufacturing plant in the region of Dél-Alföld. The Commission has given the go-ahead since the Hungarian aid is in line with the requirements of the Regional Aid Guidelines 2007-2013.
The project is for the installation of new machinery and equipment in the Kecskemét factory for the manufacture of two new passenger cars. The town of Kecskemét and the surrounding Dél-Alföld area have an abnormally low standard of living and high unemployment: they are, therefore, eligible for regional aid. According to a Commission press release: “The project involves investments eligible for the calculation of the aid of HUF 146.2 billion (€548.4 million) and an aid amount of HUF 29.7 billion (€111.5 million) in the form of a cash grant and a corporate tax allowance. In addition, Mercedes-Benz Hungary will receive financial support for railway access to the public railway network which amounts to some HUF 214 million (EUR 0.8 million). Mercedes-Benz Hungary will finance the project using own equity and bank loans”.
Approval by the Commission of the aid is also subject to conditions, which, in fact, have been met in this case, stipulating that the market share of the eligible company (Daimler AG) is less than 25% and that production capacity will not increase consumption of the product in the European Economic Area by more than 5%. (C.D./transl.rt).