Robert Bosch plans to build a new factory in Russia on the expectation that the country's car market will continue to grow rapidly in coming years.

The German automotive supplier, the world's largest, said it would invest some 40 million euros in the plant in the next three years. Construction will start in early 2013.

The factory will be built in Samara, about 1,000km east of Moscow and near the Avtovaz car plant in Togliatti. Bosch said it plans to build chassis systems controls, starter motors and generators and diesel systems in Samara. Production will be mainly for local customers.

Bosch said the factory will help extend its presence in eastern Europe. "For Bosch, Russia is an important growth market," said Gerhard Pfeifer, president of Bosch's operations in Russia and former Soviet Union member countries.

Bosch recently announced its thermotechnology division will build a new manufacturing plant in Engels, 400km southwest of Samara. The plant will make industrial and conventional boilers and will be near an existing Bosch facility that makes automotive aftermarket products and systems.

In 2011, Bosch's Russian sales soared 50 pc to nearly 1 billion euros. The group has 2,700 employees in the country.