Volkswagen joins other carmakers investing in Spanish output
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MADRID (Reuters) -- Volkswagen plans to invest 785 million euros ($1 billion) in a plant in northern Spain over the next five years, making it the third carmaker in recent months to boost investment in the recession-hit country.
The plant outside Pamplona in the region of Navarra, which employs 4,600 people, produces the Polo subcompact and has a production capacity of 300,000 cars a year, making it one of the group's largest producers.
A large part of the investment will go to preparing installations for manufacturing the next generation of Polo and its substitute in the future, Volkswagen said in a statement on Wednesday.
In November, Renault said it was hiring 1,300 new workers for its Spanish plants. A month earlier Ford said it was closing its plant in Belgium and moving production to Spain.
Nissan, however, said last week that it was cancelling plans to expand production of a new model in Spain after it failed to reach an agreement with union workers over new contract terms. Nissan said Spain was missing out on 4,000 new jobs and a 130-million-euro investment.
Spain's government has applauded the new investments by automakers, saying they are the result of a labor market reform that makes the country more competitive for businesses and also makes it cheaper for companies to hire and fire employees.
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