How a new factory in Hungary heralded the dismissal drama at Vredestein

The new tire factory is located in Gyöngyöshalász, a tiny village in the Hungarian countryside. On a piece of no man’s land, that sunny day in April 2015 was a huge event tent. With hundreds of dignitaries, media and other invited guests from home and abroad, the first stone was laid for the new factory. No costs or effort were spared by the parent company Apollo Tires from Vredestein. Luxury snacks and drinks, the mood was great.

Yet there were already signs that the fate of the Vredestein site in Enschede was sealed with the construction of the factory in the low-wage country of Hungary. This was primarily due to the financing that caused a great deal of uncertainty. The Indian owners of Apollo Tires invested nearly half a billion in the new plant. The European Union provided a substantial subsidy, prompted by the thousand new jobs in the poor and largely undeveloped Hungarian countryside.

The Hungarian Prime Minister Viktor Orbán, for that reason, had also made a personal case for a state subsidy of nearly 100 million. Due to corruption, favoritism and abuse of power, Orbán was not loved by the population and could use some success in those days.

Despite its dubious reputation, the Indian owners awarded the Hungarian politician the honorary podium in the party tent on that memorable day in April 2015. Orbán seized his chance and performed a one-man show for millions of viewers in front of the state television cameras.

At that time, Mathias Heimann was just the big boss (CEO) for the Apollo Vredestein production site in Enschede. He was of course also a guest at the first stone laying of the factory in Hungary, where, according to a statement from the group, both Apollo and Vredestein brands would be made.

Logical that questions from De Twentsche Courant Tubantia from Enschede focused on the consequences of the new factory for Apollo Vredestein in Twente, Enschede. Will part of the production from Enschede soon be transferred to Hungary with all the consequences that will have for employment in Twente? And which brands and types of Vredestein tires are involved?

Heimann said at the time that he could not give the answer. “That is not yet clear. The answer to that question will present itself, “he said. And also: “Sticking to the regional is too limited and stands in the way of international growth.”

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