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Magna on cusp of formalising PLN 1bn deal to produce cars in Warsaw


Magna International, the global automotive supplier, will later this month sign an agreement with AwtoZAZ of Ukraine about the manufacture of Mini and Infiniti cars at FSO, the troubled Warsaw auto maker owned by AwtoZAZ, Dziennik Gazeta Prawna has learnt.

The value of the project is estimated at about PLN 1bn (€240m). It is expected to bring 2,000-3,000 jobs in the initial phase and some 7,000-8,000 overall, in line with a progressive increase in output from an initial 60,000 vehicles a year to 200,000. According to sources cited by the newspaper, test runs of some components have already taken place, and full-scale production could be inaugurated in the second half of 2013. There are also plans to locate at FSO the manufacture of a delivery van.

FSO has reportedly saw off competition from plants in Austria and Hungary.

Magna has been in talks with the Polish government about the project for several months. In July the councillors of Warsaw voted to approve a temporary property-tax holiday for the company, in return for a pledge to invest at least €100m in FSO and to create minimally 1,000 jobs, including at least 35 in research and development.

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