Brussels - The European Commission has authorised, under EC Treaty state aid rules, â‚¬92.6 million of aid which the Hungarian Government intends to grant to Hankook Tire Hungary for the creation of a new production plant for car tyres in DunaÃºjvÃ¡ros, Hungary. The total cost of the investment will amount to â‚¬424.9 million, according to the Commission.
Competition Commissioner Neelie Kroes said: â€œI am happy to approve aid for this important investment by a Korean firm in Europe which will contribute to regional development and job creation in Hungaryâ€.
Hankook Tire Hungary is the fully owned subsidiary of Korean based Hankook Tire Co. The plant to be set up in DunaÃºjvÃ¡ros (about 70km south of the Hungarian capital, Budapest) will be Hankook's first production site in Europe.
The project, which will be spread over five years (2006-2010), is aimed at producing UHP tyres for passenger cars and light trucks. It is expected to create 1500 new direct jobs as well as up to 750 additional indirect jobs. Hankook said the majority of tyres made in the plant will be supplied to Europe, which is the company's major strategic market.
The aid will be paid in the form of grants by the Ministry for Economy and Transport and the Ministry for Employment and Labour, as well as a tax relief awarded by the Ministry of Finance.
The Commission said it was able to clear the aid after an investigation lasting less than five months thanks to the high quality of the notification and excellent cooperation with the Hungarian authorities.
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Press release from European Commission