In the spring of 2026, Hungary changed government. The Tisza Party, until then the main opposition force, took power and inherited a country in which a substantial share of the economy is tied to battery manufacturing. But more important still: it inherited a technological bet whose outcome remains uncertain. The question is not what the new government thinks about the plants — it is what it will do when technology moves faster than political cycles.
The technology trap
The Hungarian plants now going up — Samsung SDI at Göd, a town on the Danube just north of Budapest; CATL and EVE Energy at Debrecen, the country's second city; SK On at Iváncsa in central Hungary and at Komárom in the north-west — are all built around lithium-ion technology. That chemistry commands 90% of the market today. But the shape of the market is not being settled now: it will be determined between 2028 and 2030, when two new technologies could break through — sodium-ion and the solid-state battery.
From the end of 2026, sodium-ion will be available in passenger cars as well. By CATL's own account, its price will come in significantly below lithium-ion, and its charging speed will be competitive. If sodium-ion catches on, the lithium-ion plants going up now could find themselves at a competitive disadvantage — particularly if the lithium price does not fall further. And here is the twist: sodium-ion production lines require different technology from lithium-ion lines. The investments being made now cannot be converted overnight.
The solid-state battery is more radical still. Toyota, Samsung SDI and CATL all promise first deliveries by 2027, but mass production will probably begin somewhere between 2028 and 2030. If that happens, the entire industry reorders itself: today's production lines become obsolete, battery packs weigh half as much for the same range, and the fire risk all but disappears. Anyone who cannot make the switch will be left behind.
What is the risk of technological obsolescence? When a plant is designed to run for 20 years and the technology changes after five, half the investment can be lost. This is not a theoretical risk: the solar industry has already shown how ten-year-old production lines become worthless the moment a newer, more efficient technology appears. The battery industry is tracing the same path — only faster.
The market risks
Hungary is not competing alone — but its rivals fall into two distinct groups. Romania and Poland are EU members: the same battery regulations and the same requirements under the CRMA, the EU's Critical Raw Materials Act, apply to them as to Hungary. They can tempt manufacturers with cheaper labour and more favourable sites, but they cannot offer regulatory laxity. Serbia and Turkey, by contrast, sit outside the EU: they genuinely can offer looser environmental and labour-law terms — although anything they export into the EU must still meet the battery-passport requirements and the EU's Carbon Border Adjustment Mechanism (CBAM). Should EU regulation become too strict — because of fresh obligations under the CRMA, say — manufacturers may relocate to sites beyond the Union's borders. The Hungarian government must now strike a balance: tighter environmental and worker protection for the people who live here, but not so tight that companies go elsewhere.
The other risk is dependence on China. More than 55% of the global EV battery market is in the hands of CATL and BYD. If those companies decide to repatriate production — because of geopolitical tension, say, or because it becomes cheaper to build at home — Hungary is left with empty factories. The contracts are binding, true, but the technological know-how, the supply chain and the market access are all in Chinese hands.
What happens to the plants already built?
Samsung's Göd plant will probably switch production over if the solid-state battery takes hold — the company is already promising its own solid-state technology for 2027. CATL's Debrecen site is the greater risk: if the Chinese parent decides to start sodium-ion production not here but in China or in a cheaper country, the Debrecen plant could be reduced to module assembly alone. EVE Energy's Debrecen plant stands on firmer ground: it makes next-generation cylindrical 4695 cells for BMW's “Neue Klasse” platform, and the German carmaker's long-term contracts underpin the demand. SK On's plants at Iváncsa and Komárom likewise rest on a solid order book: the company is a long-term battery supplier to Volkswagen, Ford and Mercedes. That diversified customer base offers partial protection against geopolitical risk, though the strategic decisions of the South Korean parent remain decisive. BYD's car plant at Szeged, in southern Hungary, meanwhile runs on an entirely different logic: what is built here is not batteries but finished cars, and the Chinese company is building them for its own brand.
| Plant | Technology | Risk | Stability |
|---|---|---|---|
| Samsung SDI (Göd) | Lithium-ion → solid-state | Medium | High — in-house solid-state technology |
| CATL (Debrecen) | Lithium-ion, sodium-ion planned | High — decisions taken in China | Medium — depends on the parent company |
| EVE Energy (Debrecen) | Lithium-ion — BMW Neue Klasse 4695 | Medium | High — long-term contract |
| SK On (Iváncsa, Komárom) | Lithium-ion (NCM) — supplier to VW, Ford and Mercedes | Medium | High — contracts with several European carmakers |
| BYD (Szeged) | Car assembly (not batteries) | Medium | Medium — depends on BYD's own car sales |
Where that leaves the Tisza government
The new government cannot halt the investments, but it can shape the terms. Under the Tisza Party's programme, environmental inspections are to get tougher, the proportion of Chinese workers is to be capped, and the subsidy regime is to be made more transparent. This is not a revolution, but it is a change. The question is whether it will be enough for the Hungarian economy to draw real benefit from the battery industry — or whether the upshot is that foreign companies manufacture a little more cleanly, and with a slightly more Hungarian workforce.
Behind the decisions lies the sunk-cost fallacy: several trillion forints paid out so far — the equivalent of several billion euros — cannot be recovered. The economically rational course would be for the new government not to set about “rescuing” money that is already spent — not, that is, to keep obsolescent plants on life support with fresh subsidies — but to write off the loss if the market turns towards sodium-ion or solid-state. That is extraordinarily hard politically, but economically it is the only rational path.
To anyone who takes market processes seriously, the biggest risk is that the state has bet too much on a single hand. When political decision-making becomes the main mechanism for allocating resources, firms optimise not for what consumers want but for what the government is handing out. And if the government gets it wrong — about the direction of the technology, say — the whole country pays the price.
What will 2030 look like?
The likelier scenario: the plants now going up will run — but not in the way, or with the benefits, that the previous Fidesz government's propaganda promised. Samsung may switch to solid-state; CATL either stays with lithium-ion or moves to sodium-ion; EVE supplies BMW steadily. A share of the jobs will be filled by Chinese workers, a share of the profits will flow abroad, and local residents will bear the environmental burden. But if the Tisza Party keeps its promises, decision-making will be more transparent, environmental inspections tougher, and a binding cap will be placed on the proportion of guest workers from outside the EU.
The big question, though, is technological: can Hungary manage not just to manufacture, but to develop the technology itself? Because as long as the country only manufactures, the technology will always come from somewhere else — and so will most of the return. The real prize would be for the next generation of batteries to be born here — but of that there is, as yet, no sign.
Politics is built out of short-term bets. Technology is built out of long-term consequences. When the two meet, politics usually wins in the short run and technology loses in the long run. The Tisza Party is now at the point where that gets decided: can it take decisions that will still look good in 2030 — or only in 2027?
— The Danube Lens