Daimler Plans Second Mercedes Plant in Hungary

Daimler AG says it will invest about €1 billion ($1.1 billion) to build a next-generation “flex-plant” to make front- and rear-drive Mercedes-Benz vehicles at its manufacturing complex in Kecskemet, Hungary.

The factory will include bodymaking, a paint shop, final assembly and an adjacent supplier park. Daimler says production operations will be fully digitally networked to enhance flexibility. The plant will begin operations in about 2019, creating some 2,500 new jobs.

Mercedes opened its first assembly plant in Kecskemet in 2012 to make small front-drive vehicles for global markets. The facility, which has built more than 500,000 vehicles since then, produces B-Class cars and is the company’s sole source for CLA small sedans and sport wagons. In April Daimler announced a €580 million ($648 million) expansion and upgrade for the complex, which will continue to specialize in front-drive models.

Daimler notes that it will expand its Mercedes lineup from the current 32 passenger models to 40 cars and crossover vehicles within the next few years. The company also expects eventually to offer hybrid and/or all-electric options for its entire Mercedes passenger car series.