Audi adjusts Hungary factory operations over Ukraine crisis

The company logo is seen at the headquarters of the German car manufacturer Audi, amid the spread of the coronavirus disease (COVID-19) in Ingolstadt, Germany, June 3, 2020. REUTERS/Andreas Gebert

BUDAPEST, March 17 (Reuters) – German carmaker Audi said on Thursday it was adjusting its manufacturing operations at its Hungarian factory, which accounts for a chunk of Hungary’s exports, because the war in neighbouring Ukraine was affecting supply chains and sales.

Russia’s invasion of Ukraine has undermined hopes for renewed growth in Central Europe’s car industry this year and for the wider economy, just as businesses were looking forward to a recovery from the pandemic. read more

Audi Hungaria Chairman Alfons Dintner told a media briefing the factory in the western town of Gyor was already changing its engine manufacturing shifts and had stopped exports to Russia, in line with a decision by Audi owner Volkswagen .

But the impact on the Hungarian factory would “not be dramatic” he said, adding that the plant produced 1.6 million engines last year, including 250,000 electric drivetrains.

“Our revenue will be slightly lower, but this is still the beginning of the year, and we have lots of serious opportunities, so there is a good chance for us to make up for many things by the end of the year,” Dintner said.

Suzuki’s (7269.T) Hungarian factory has also suspended car exports to Russia and Ukraine as of March, while German premium carmaker Daimler-Benz (MBGn.DE) said it had lowered output to two shifts at its Hungarian plant. read more

Dintner said the Hungarian Audi factory, whose revenue rose by 2.6% to 7.7 billion euros ($8.52 billion) last year, had fulfilled all orders so far despite supply chain challenges, adding that its order books were in a good shape.

($1 = 0.9035 euros)

Reporting by Gergely Szakacs and Anita Komuves; Editing by Jason Neely and Edmund Blair

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