Peugeot Citroen to build cars in Russia

Peugeot Citroen has announced plans to build a car plant in Russia. The French auto maker has chosen the city of Kaluga, southwest of Moscow, for its first factory in the country.

Rivals in the family-car market, Volkswagen, already have a plant there.

The new complex will specialise in the production of mid-sized vehicles.

Peugeot Citroen also has plans to expand operations in Russia, where mid-range cars account for 60% of sales.

The factory is expected to be completed by 2010.