MÁG - the story of the most successful Hungarian car company

Back in the 19th century, Hungary was primarily engaged in agricultural activities. During the 1870s when it became part of the Austro-Hungarian Monarchy and the first waves of the industrial revolution swept through the country the situation hasn't improved much either. So it's no wonder Hungary didn't had a thriving automobile industry.

Automobiles were still a rare sight all around Hungary during the early 1900s. A contemporary account recorded 10 automobiles at the turn of the century and a couple of hundreds within ten years.

Although there were a few very daring souls who tried their hands on making motorized vehicles, among them János Csonka an influential figure on the local scene, but the first company to seriously consider automobile production was the mill equipment factory of Podvinecz and Heisler.

Daniel Podvinecz and Vilmos Heisler set up their mill accessory shop back in 1884. The milling industry was the first to be equipped with various machines in Hungary during the late 19th century and with the help of a few local inventions it actually became a renowned business throughout Europe. Most of the bigger industrial companies started their activities in this industry.

The shop of Podvinecz and Heisler soon became popular and business was booming. By 1895 they were able to set up their own premises to manufacture those accessories which previously were sourced from abroad. Stationary engines were the next logical step and then one day Heisler had an idea.

He heard that in Baden, Austria properties of the Leesdorfer automobile factory will be auctioned off and convinced his business partner to go for it. The year was 1903 and in January 1904 the first announcements were made that Podvinecz&Heisler bought all assets of the Leesdorferer company and local production will commence in no time. There's no record whether such a car was ever assembled at all.

By 1905 Podvinecz&Heisler bought the licence of the fire-struck Cudell company in Aachen and exhibited a Phoenix car at the 2nd Budapest Autoshow. This car won a prize and received raving reports in the local press: "In the not so distant future the Hungarian industry will provide a product on par with the best of Europe". After the comapny won a prize at the aforementioned exhibition, the Industrial Committee of the Hungarian Automobil Club visited the factory. This meant an official approval and contacts to government circles.

However lack of finance, expert workers and the resistance of the public to buy an untried product -compared to the possibility of travelling to Wien and buy a car from one of the trendy shops there - meant that automobiles were still just a sideline for P&H. Podvinecz&Heisler offered the following Cudell Phoenix models:

- 2-cylinder, sv, aircooled 10/12 bhp

- 4-cylinder: 12/14 bhp, 16/20 bhp, 20/24 bhp and 35/40 bhp. All of them were equipped with multitubular radiator, skin-coned clutch, 3+1 speed transmission, chain-drive, semi-elliptic leaf springs and two-wheel brakes. Naturally bodies weren't available, those were provided by local carriage builders.

Heisler was further encouraged in 1907 by the new industrial law which tried to protect the local industry and offered various advantages for those who set up new type of factories. It was a direct result of this law, that in 1908 the First Hungarian Automobile Factory was erected in Arad, while Heisler applied for a loan at the aforementeioned Hungarian Commerce Bank of Pest to finance further expansion. During the process his business partner died but he pressed on relentlessly.

He was proved to be right when the Hungarian Post and various rural bus companies placed orders in various quantities. But the biggest challenge was the "Subventions" programme of the joint Army of the Monarchy. Both the Hungarian and the Austrian Army set up its incentive scheme whereby the buyer of an exactly specified truck received cash support in exchange for a promise of providing his vehicle to the Army in a given period of the year.

This was the main reason Heisler asked for more loans, even Government support and slowly transformed his business. In 1912 the company was renamed to MÁG (Magyar Általános Gépgyár - Hungarian General Machine Factory) with the main activity being motorized vehicles and engines for ships.

Trucks, especially tailored for Army needs were the main products but passenger cars, postal vans and buses were also produced.

These postal vans, based on the design of János Csonka were powered by a 1-cylinder 10 bhp engine. The main passenger car type was developed by Jenő (Eugene) Fejes. 

Fejes who previously worked for the Arad automobile factory was one of the most talented automotive engineers in Hungary of its time. During the 1920s he designed his own automobile with chassis and engine made of welded sheet steel, eliminating the need for casting. This car was to be manufactured in England by the Ascot Motor Co. but only a few prototypes were completed between 1928 and 1930. But let's go back to the early 1910s and his role at MÁG.

His first job at MÁG was to revamp and refresh the Phoenix model range. His 25 bhp model shared only a few bits with the previous Phoenixes. It was powered by a 3-liter, 4-cylinder water-cooled SV engine. It had a total length of 4085 mm with a wheelbase of 3000 mm. Various bodies were supplied by the leading Hungarian coachbuilders, like Kölber, Misura, Zupka and Glattfelder. Glattfelder, Misura and Kölber were traditional carriage makers who added automobile bodies to their profile while Antal Zupka was originally a blacksmith turned to coachbuilder. His son, Lajos Zupka opened his own shop after the First World War.

Fejes also designed two truck chassises, a smaller 2-ton version and a bigger which had a trailer and a capacity of 10 tons. 

As the model range was sorted out Fejes made the necessary preparations to install assembly lines but the First World War intervened.

During the first World War the MÁG factory moved to new premises and switched to airplane production. Trucks were assembled in small scale up to at least 1916. This factory adorned by an airport became decades later one of the main sites of the Ikarus bus factory.

During the War the Hungarian Commerce Bank of Pest sold its interest to the General Credit Bank of Hungary. The Bank promoted another director to help the work of Vilmos Heisler. He was Gyorgy (George) Horovitz, a Polish-born engineer who formely worked for the Austrian Daimler company. From this moment MÁG was not led by the will of Heisler alone but by the Board of Directors including Heisler, Horovitz, engineers from the company and bank representatives. 

During the War the company set up business relations with the Austro-Daimler and Puch companies. These were all controlled by Italian-born businessman, Castiglione Camillo. Austro-Daimler provided much needed technical expertise to MÁG and the two companies shared a lavish showroom in downtown Budapest which later also featured the popular Puch motorcycles.

Suffering the consequences both of the lost War and the disintegrated Monarchy MÁG had a very troublesome period between 1919-1921. Airplane production was forbidden, lack of cash and raw material combined with strikes almost crunched the company.

But the 10 bhp Csonka-designed former postal van was exhibited at the 1920 Budapest International Fair in passenger car guise and through a business connection with the Austrian Daimler factory MÁG products were shown at various shows abroad as well. In 1921 it was reported that a bunch of 10 bhp MÁG sedans were shipped to the UK and sold as Wohl-MAG.

To illustrate the struggle of MÁG a good example is the case of the Budapest Taxi company which ordered 150 chassises in 1922. However within a year only 45 were completed! These chassises were also bodied by coachbuilders, like Neuschloss-Lichtig. This company mainly catered for products made of wood, like furnitures or parquets and also wooden framed automobile bodies. These contracts meant the lifeline for the Hungarian coachbuilding industry while there weren't enough individual orders.

But the Spring of 1923 showed some promising signs like the introduction of a new MÁG, the 20/25 bhp Magomobil. Looking all the world like a contemporary Italian or German car it was still a 4-cylinder effort with a lengthened chassis, increased track and altered suspension. The Magomobil was to be the most popular Hungarian-made car ever. It had a 4-cylinder 60x100 side-valve 16 bhp engine , Bosch magneto, Pallas or Zenith carburetor, pressed steel frame with semi-elliptic suspension. Dimensions were: wheelbase 2450 mm, track 1150 mm and the kerb weight was about 540 kg. A Magomobil brochure featured Double Phaeton (touring), Cabriolet, Landaulet, Sport and truck bodies.

It was at this time, that Walter S. Rieneck, the American Consul compiled a brochure, titled Automotive Trade and Industry of Hungary" Among his observations, there are some which puts the efforts of MÁG into international context: "The selling price of the M.A.G. is at the present time 110,000,000 crowns, or the equivalent of about $1470. This is for a five-passenger open car of the type, that would sell in the United States for about $900, and it will therefore be seen that it would not able to compete with foreign automobiles unless it enjoyed the protection of a very high tariff".

MÁG produced around 150 cars in 1923 and 500 cars in 1924.

While the 600-strong workforce was occupied with sorting out the teething problems of the Magomobil production behind the scenes the management talked about future products. Unfortunately it was decided that the limited financial resources will be shared between the development of the Magomobil and another 6-cylinder tourer model. This ultimately meant two under-developed cars.

An updated Magomobil was introduced for 1925 featuring a slightly enlarged engine: 62x107 mm, 1292 cc and a maximum power of 25 bhp. The gearbox and the engine formed one block. It now had a wheeébase of 2775 mm with a max speed of 75-80 km/h. Kerb weight of a tourer was 980 kg. It was sold in small quantities in Austria and reports mentioned sales in South America, China and Japan. 

The Credit Bank also got in touch with MÁVAG, the Hungarian Royal Iron,- Steel- and Machine Factory which was one of the major industrial concerns in Hungary. MÁVAG was preparing itself for the production of light commercial vehicles and buses. MÁG and MÁVAG decided to share parts to shed development costs. 

Hungarians still respected the Habsburgs who for centuries governed the country and in 1926 a richly decorated Magomobil was presented to Otto Habsburg, son of the last Hungarian king, Charles. 

Protecting laws, massaging the public with patriotic slogans were not enough to convince the buyers: 1926 registrations showed 857 Fiats versus 690 MÁG automobiles while Ford came in third with 622 cars. By this time the Hungarian government had commercial agreements with various foreign countries and American, Italian and French cars had very favorable import duties thus making them even more attractive for the local buyer. But MÁG was kept alive with state orders and bank loans.

It was hoped that the bigger, 6-cylinder Magosix would be the necessary flagship of the MÁG line-up. While previous MÁG cars usually followed European design this time the engineers used American practices and components! The gearbox and cardan axle were bought from Mechanis Universal and later Hardy Spencer while the rear axle was sourced from Salisbury, the steering from Ross Gear and the hydraulic brakes from Lockheed. The engine was a self-designed 2.1-liter 50 hp side-valve effort capable of 40 bhp. Equipped with an open tourer body the car was capable of 95 km/h max speed. For the first time production lines were installed in the factory. Prodcution dropped to 180 cars in 1928 then increased to 430 cars the following year. 

It is very interesting to witness that between 1926-1929 there was a short boom in the Hungarian automobile sector. Registrations increased dramatically, lots of new races helped promoting various makes while a whole bunch of new magazines entertained the readers. One of the magazines, Úrvezető (Chauffeur) even organized the Hungarian equivalent of the internatjonal beauty contest at the frequented place of the élite the Margareten Islands in Budapest. The first Concours d'Elegance took place there in 1928 and it was to become the main demonstration place for the local coachbuilding industry for years to come. Smaller scale events followed in the bigger rural cities, like Székesfehérvár or Pécs.

But these developments actually killed MÁG. Although being somewhat protected with duty and tax advantages the yearly production of a couple of hundred units was not enough to keep the company floating. Improving the engine, offering more body styles couldn't help. MÁG comissioned Géza Nagy, coachbuilder for the rich and famous to build a body on a Magosix which won a gold prize at the Concours d'Elegance Show in 1929.

After pumping in enermous sums the General Credit Bank of Hungary tried to save the company by offering it to Manfréd Weiss, the biggest industrial conglomerate in the country then to Fiat and finally to General Motors. 

As no takers were found and the heat of the Depression increased the Bank pulled the plug in 1930. Within three years the plant was closed and its assets were sold for peanuts to the Méray Motorcycle factory.

The factory in Mátyásföld, on the outskirts of Budapest remained empty for 10 years and then a coachbuilding company and later the Ikarus bus factory occupied it.

The taxi version of the Magomobil, called the Magotax was the most enduring as they were even used after the war. Luckily one car escaped the scrapyard when the Communists regime decided it was time "to erase the past at once". From 1950 passenger car ownership was virtually banned in country. It was only after the 1956 Revolution that regulations eased up a little bit and from 1963 it became easier to acquire cars. You can't compare the situation to western countries though as it was still a highly bureucratic process and took years to buy a brand new East European made car. Western makes were the privilege of Socialist party leaders and those who worked abroad or who had rich relatives abroad. 

The Hungarian Museum of Transport set up its automobile division in 1956 and today at least four MÁG cars belong to their collection. 

A restored Magosix tourer is in private hands and it was recently completed and showed all over Hungary.

From time to time chassis pieces, engine components surface and it is reported that there are one or two Magomobiles hidden in Slovakia.

The detailed history of the MÁG company still needs to be written. A paper was published by the Hungarian Museum of Transport in 1979 but important pieces are still missing. The MÁG archives have disappeared, while other archive material can only shed partial light on the activities of the company. American research at the GM archive found interesting documents so it is hoped that other carmakers' archives may contain other MÁG-related documents.

Text: Pál Négyesi