Mumbai, 27 August 2008: General Motors, tomorrow, will enter into an agreement with Maharashtra for an engine and transmission plant, in order to step up the pace in the country, which is one of the world's fastest-growing auto markets.

The unit will be located in Talegaon, where GM's second vehicle plant is scheduled to start operations next week, a spokesman said, declining to give details of the investment or the plant's capacity to make engines.

"It is an extension of the investment GM has made in Talegaon for the vehicle facility," he said.

GM is scheduled to hold a news conference tomorrow in Mumbai, where it will sign a Memorandum of Understanding (MoU) with the state.

GM, which makes the Chevrolet brands of Optra, Tavera, Aveo and Spark in Gujarat, will have a production capacity of 1,40,000 vehicles in the new car plant, taking its all-India capacity to more than 2,25,000 units.

GM will build a new small car in the new plant as it aims to double its market share to 10% by 2010.

Tata Motors is set to launch the Nano in October, while Bajaj Auto is building a similarly-priced car with Renault and Nissan.

GM's move to set up engine plant in India comes after their rivals, Ford Motor Co, which in May said that it had started operations at its engine assembly plant in Chennai, with an eventual capacity of 2,50,000 units.