Daimler, Mitsubishi Pick Plant Site
FRANKFURT, Germany (AP) _ Automaker DaimlerChrysler AG said Thursday it has chosen a site at Koelleda in eastern Germany for a plant that will make engines for a new small car that it is to produce with Mitsubishi Motors Corp.
The company chose Koelleda over Nyergesujfalu in Hungary for the plant, which will create some 500 jobs, DaimlerChrysler said.
The companies plan to invest a total of $224 million in the new plant, DaimlerChrysler has said. DaimlerChrysler and Mitsubishi plan to found a joint venture company to operate the plant in 2003.
DaimlerChrysler holds a 37 percent stake in Mitsubishi. The plant will produce engines for small passenger cars, which are to be built in Born, Netherlands.
``This joint undertaking is one of the most important milestones in our alliance with Mitsubishi,″ company chief executive Juergen Schrempp said in a statement.
The cars are to be sold under the Mitsubishi and Smart brands, the company said. The 398,000 square-foot plant will have an annual production capacity of up to 300,000 engines a year, the company said.
The company said that it had received word Thursday that the European Commission in Brussels had decided to permit $51 million in subsidies for the project from the federal government and the state of Thuringia, where the plant will be located.