After Acquiring a Russian Factory, Hungarian Railway Vehicle Giant Ordered to Liquidate

The Metropolitan Court of Budapest recently ruled that Ganz-MaVag International Zrt., a leading Hungarian railway equipment enterprise, and its subsidiary Dunakeszi Járműjavító officially initiate liquidation proceedings. The ruling is based on the fact that both enterprises have fallen into a severe state of insolvency and are utterly unable to resume normal operations without external assistance. The implementation of this ruling means that the core pillar of Hungary's railway manufacturing industry is on the brink of collapse.

Ganz-MaVag's financial crisis did not occur suddenly; its root cause can be traced back to 2022. At that time, the company acquired the Dunakeszi factory from Russia's TransMash-Holding. This acquisition, combined with the huge losses from the Egyptian freight car delivery contract signed in 2018, directly caused the company's debt to snowball continuously. It is estimated that the company's outstanding debt currently exceeds 40 billion forints (approximately 103 million US dollars). In the autumn of 2024, as its capital chain was completely broken, the Dunakeszi factory ceased production entirely. Prior to this, the factory was also undertaking passenger car renovation orders from Hungarian State Railways (MÁV), and the production suspension directly affected the progress of relevant projects.

To make matters worse, in 2024, Ganz-MaVag, in conjunction with the Hungarian sovereign fund Corvinus Zrt., planned to acquire the Spanish train manufacturer Talgo for 620 million US dollars. This would have been an important opportunity for the company to reverse its crisis, but the deal was rejected by the Spanish government on the grounds of "security concerns", causing the company to miss this chance. It is worth noting that Ganz-MaVag has 673 employees; it is not only the core assembly base for the intermediate carriages of KISS EMUs but also has long provided maintenance services for Hungarian State Railways (MÁV). Its former owner includes Kristóf Szalay-Bobrovniczky, the Hungarian Minister of National Defence.

Experts have warned that the collapse of the Dunakeszi factory may not only severely damage Hungary's industrial foundation but also threaten the stability of the country's entire freight car production system. Although the Hungarian government had previously considered providing rescue support, the huge funding gap of 40 billion forints ultimately made the government hesitate and back down. Currently, liquidators are considering two plans: one is to sell the enterprise as a whole to the state, and the other is to promote the transfer of assets after bankruptcy. However, the latter is extremely difficult to implement—because the core assets of the factory are various qualification certificates, and it will take at least one and a half years for a new enterprise to re-obtain these certificates.

From the perspective of industry impact, the collapse of Ganz-MaVag has had a dual impact: on the one hand, it has caused Hungary to completely lose its local railway equipment manufacturing capacity; on the other hand, it has added more uncertainties to the already complex European railway supply chain. How to preserve core technologies and key jobs during the liquidation process has become an urgent problem that the Hungarian government must solve.