Volkswagen is to invest $184m (R1.1b) in the project at its Autoeuropa factory, according to data from the Portuguese economy ministry reported by the
Diario Economico newspaper.
Portuguese Prime Minister Jose Socrates had announced last week that Volkswagen would begin manufacturing a new model at the plant, but declined to give further details.
Production is expected to reach 35 000 units per year and the Portuguese government offered financial incentives to attract the investment, the paper said.
The Autoeuropa factory near Lisbon is the biggest foreign direct investment project in Portugal.
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