Szijjártó takes BYD job after subsidy

Peter Szijjártó spent years selling Hungary as the European home for Chinese electric vehicles. This week, Hungary's former foreign minister left parliament and joined BYD, the Chinese carmaker whose expansion in Hungary he had promoted from office.

Péter Magyar, the opposition leader, called it one of the most outrageous forms of corruption (24.hu). The move was quickly picked up outside Hungary too (LA Times). The ethics row and the subsidy question are legally separate. Economically, they sit on the same table.

The public money behind the hire

Under Szijjártó's ministry, Budapest channelled about HUF 50 billion, or roughly €120 million, in state support linked to BYD's Hungarian projects (24.hu). Hungary's offer to carmakers has never been only about grants. Mercedes has described Hungarian production costs as roughly 70% below German levels, with quick permits and infrastructure already in place (Handelsblatt).

EU state-aid rules, under Article 107 TFEU, are meant to stop governments giving companies selective advantages that distort competition across the single market. Subsidies can be allowed for regional development or green investment, but the public cost is supposed to be justified by a public return. A former minister taking a job with the beneficiary does not, by itself, make the aid illegal. It does make the bargain look much less grand for taxpayers.

Why the subsidy race exists

Chinese-made electric vehicles face EU tariffs: 17% for BYD and up to 35.3% for other Chinese producers. Even with those tariffs, Chinese models still sell for about 21% less than European rivals (taz, CSIS). Build the same cars inside the EU and much of the tariff problem disappears. Since the Commission opened its anti-subsidy investigation in September 2023, ten new production sites linked to Chinese manufacturers have been announced across Europe (taz).

The conditions vary sharply from country to country. Spain is courting SAIC in Galicia while requiring at least 50% local or European components by 2030 (El Mundo). France links consumer purchase bonuses to where and how a car is made, meaning BYD's future European-built vehicles could qualify for French subsidies (Auto Orange). Hungary offered money, low costs and few public conditions.

Who gains, who pays

Hungarian construction firms, logistics companies and local workers gain from factory activity. European consumers gain if cheaper electric cars arrive faster. But the pressure lands elsewhere too, particularly on German and Polish suppliers. Polish industry analysts say about 45,000 jobs in batteries, car parts and steel could be at risk, with possible indirect costs of €11.4 billion for the Polish economy (Money.pl).

The harder question is what these factories actually make. A plant assembling cars from imported Chinese batteries and electronics creates employment, but it does not necessarily build European capability in the most valuable parts of the EV chain. EU member states granted €168.23 billion in state aid across all sectors in 2024 (European Commission). Without enforceable conditions on local content and technology transfer, part of that money risks paying companies for access to a market they were already determined to enter.

Three legal tests now sit beside each other. EU state-aid rules ask whether Hungary gave BYD an unfair advantage. The Foreign Subsidies Regulation, aimed at non-EU state backing inside the single market, asks whether Chinese government support distorts BYD's European position (Euronews). Hungarian ethics rules ask whether Szijjártó personally benefited from decisions made while he was in office.

The evidence points beyond one politician's career move. Europe still has no common test for when Chinese EV investment builds genuine industrial capacity and when it simply buys tariff-free access with European public money. Spain's local-content targets and France's eco-score system are early attempts to draw that line. Hungary shows the alternative: a €120 million public bet with returns still unaudited, followed by the minister who helped place it taking a seat on the company's side of the table.