BUDAPEST (Reuters) - About 2 million of the 11 million diesel engines involved in the Volkswagen (>> Volkswagen AG) emissions scandal were manufactured at an Audi (>> Audi AG) plant in western Hungary, Economy Minister Mihaly Varga told private broadcaster TV2 on Tuesday.

Varga also said the government was in talks with Audi as well as German rival Daimler's (>> Daimler AG) premium brand Mercedes, which also has a big factory in Hungary, to assess the potential impact on the local economy.

"I am sure that this will affect Hungarian car manufacturing and the local car industry, but I hope the fallout will be smaller than what the disaster scenarios foreshadow," he added.

The minister has previously said that the Hungarian economy could lose 0.3 to 0.6 percent of growth if European car sales decline due to the scandal.

Varga said that "for the time being" Hungary had no plans to ban VW cars, after the automaker admitted to hacking its own cars to deceive U.S. regulators about how much their diesel engines pollute.

Audi's plant in Hungary, located in the western town of Gyor, is a key supplier for the VW group. The plant manufactured 1.97 million engines and 135,232 cars last year, according to figures published on its website.

Daimler (>> Daimler AG) also operates a Mercedes factory in Kecskemet in central Hungary which has an annual capacity of 150,000 cars. The automaker has denied that it had manipulated emissions data.

(Reporting by Gergely Szakacs; Editing by Miral Fahmy)

Stocks treated in this article : Audi AG, Daimler AG, Volkswagen AG