MERCEDES BENZ and AUDI step up production in Hungary

Mercedes Benz B Klasse 2012

Mercedes Benz’s 800 million euro factory, located in Kecskemet about 90 kilometers of Budapest, the Hungarian capital, began this week production of the Mercedes B-Class compact, marking the brand’s first new assembly facility in 15 years — and likely the last major auto facility to be built in Europe.

Combined, the Kecskemet and Rastatt (Germany) plants of Mercedes Benz will have an estimated capacity of about 450,000 vehicles, which would be equivalent to 35 percent of Mercedes car sales this year, according to data from IHS Automotive. Daimler declined to provide figures for the plants.

Mercedes is following Audi, which has manufactured motors in the western Hungarian city of Gyor since 1993. Audi began building the 30,500-euro TT coupe there in 1998 and is investing 900 million euros to expand annual capacity to 125,000 cars by next year from 38,500 in 2010.