RIGA - The town of Jelgava received a huge investment boost when construction of two new plants, part of separate projects, began this week.
Construction of a vehicle-manufacturing complex in the city of Jelgava, part of a joint venture between Latvia's Ferrus and Russia's ZIL automotive producer, was launched, while Germany's AKG laid the cornerstone for a new plant that will produce vehicular cooling systems.
The Jelgava City Council announced on Aug. 2 that the vehicle-manufacturing complex would initially assemble ZIL trucks and later buses for public transport.
The truck and bus bodies will be made and supplied by ZIL, the Moscow-based auto plant, while engines will be supplied by U.K.'s Cummins. Transmissions are to be made by ZF in Germany, and some parts will be provided by Latvian companies.
The plant is expected to assemble around 1,000 vehicles a year, which will be sold in the EU, Asia, Africa and Russia at a cost between 19,000 euros and 20,000 euros. Fifteen million euros are to be invested in the project, which will employ some 100 people, though the number of employees may rise to 300 later.
The plant is set to start work at full capacity within 18 months time.
Meanwhile, the City Council said that the AKG plant would cost 10 million - 12 million euros and cover a 46,000-square-meter territory at Jelgava's industrial park. It would also create at least 100 jobs, the council said.
Prime Minister Indulis Emsis and the German Ambassador to Latvia Ekhard Herold attended the cornerstone laying ceremony for the plant on Aug. 2.
AKG, which has plants in various countries, including Germany, the U.S.A. and China, and has an annual turnover of 200 million euros, also presented a check worth 5,000 euros to the Jelgava City Council for improving traffic safety in the city, Latvia's fourth largest.
During the Soviet period cars were produced in Jelgava at the RAF plant.