Hungary Rail Crisis: GMVI & Dunakeszi Liquidation Impacting Rolling Stock

Introduction

The Budapest Metropolitan Court has ordered the liquidation of Ganz-Mavag International (GMVI) and Dunakeszi Járműjavító, impacting Hungary’s rolling stock manufacturing sector, according to data from the Opten company register. The two firms have been facing financial difficulties, raising concerns about the future of the national rail industry.

Main Content

Liquidation Proceedings

The Budapest Metropolitan Court initiated liquidation proceedings against Ganz-Mavag International (GMVI) and Dunakeszi Járműjavító, also known as the Dunakeszi Rolling Stock Manufacturing, Repair and Maintenance Works, on Thursday. Both companies have faced significant financial challenges in recent years.

Company Overview and Contracts

GMVI serves as the parent company of the group, which includes the Dunakeszi factory. In 2020, Kristóf Szalay-Bobrovniczky, the current Defence Minister of Hungary, was briefly among its owners. That same year, the company secured a HUF 32 billion contract from MÁV for the production of new rolling stock.

Strategic Importance and Operations

The Dunakeszi facility employs 673 people and is vital to Hungary’s rail manufacturing capacity. It has previously manufactured intermediate cars for Stadler’s KISS double-deck EMUs and continues to perform major repair and maintenance work for MÁV.

Financial Difficulties and Potential Solutions

The company’s financial troubles began with a 1,350-car order for Egypt, a joint venture that originally involved Russia’s Transmashholding. After the imposition of war-related sanctions, the Russian partner withdrew, leaving Dunakeszi to continue production at a loss. The Hungarian government expressed its intention to rescue the factory, adopting two decrees for its preservation. However, analysts estimate a state injection of around HUF 40 billion would be needed for full financial stabilization. Industry observers suggest that a potential solution could involve the state purchasing the companies through the liquidation process.

Conclusion

The liquidation of GMVI and Dunakeszi Járműjavító poses a significant challenge to Hungary’s rolling stock manufacturing sector. The future of the industry hinges on potential state intervention and the complexities of re-nationalization.

Company Summary

Ganz-Mavag International (GMVI): Parent company of a group that includes the Dunakeszi factory, with a history of rolling stock contracts.

Dunakeszi Járműjavító: Also known as the Dunakeszi Rolling Stock Manufacturing, Repair and Maintenance Works, a key player in Hungary’s rail manufacturing, performing repair and maintenance work for MÁV.

MÁV: A company that awarded a HUF 32 billion contract to GMVI for rolling stock production.

Magyar Vagon: A railway group.

Corvinus Zrt.: A fund owned by the Hungarian state.