6 Spread of electromobility and expected impact thereof on the Hungarian economy

Of the key megatrends, the spread of electromobility is supported by environmental protection, the changing energy mix, as well as by Industry 4.0. The automotive industry is approaching a turning point, where e-mobility and digitalisation may be defining factors. At present, the market of electric vehicles lags behind that of traditional vehicles, but in parallel with the decline in production and investment costs, this market may grow dynamically in the coming decades. The evolution of production is also reshaping the geographic configuration of commodity supply; demand for lithium and cobalt – which are relatively scarce in volume with highly concentrated extraction in geographic terms – may increase significantly. This turning point in the automotive industry is particularly important for Hungary, considering the high economic weight of the sector, even in a regional comparison. The strategy of the car manufacturers, which is relevant for Hungary, focuses on electric drive. However, as a result of the fewer components, supplier networks may shorten, which may complicate entering the changing production chains. Developed education and infrastructure, as well as an increase in the importance of creative industries and services, are key for the shift towards production of higher value added.