French car group PSA Peugeot Citroën announced today that it has notified the Russian authorities of its decision to build a plant in the city of Kaluga, which is located around 180 kilometres or 112 miles southwest of Moscow. The new factory which is scheduled to open in 2010, will produce vehicles in the midsize segment, which represents nearly 60% of all sales in the expanding Russian market.

The French group plans to sell around 100,000 Peugeot and Citroën vehicles in Russia in 2010, with a commitment to eventually raising this number to 300,000 a year. The signing ceremony for the project is scheduled to take place in Russia in early 2008.