Peugeot Citroen plans its first auto plant in Russia

To establish a larger share of the Russian automotive market, French car maker Peugeot Citroen has announced that it plans to build its first factory in Russia

Peugeot Citroen has identified Kaluga, southwest of Moscow, as the site of its proposed new plant.

The automaker says it will begin assembling mid-sized vehicles in 2010 at the new plant, from where it has projected sales of 100,000 vehicles in 2010 and scale it up three-fold in the next few years.

The Russian market had sales of around two million new cars this year, with room for rapid growth in demand. Several auto leaders have set up car plants in the country to avoid high import duties in the country.