French automotive giant PSA Peugeot Citroen said Friday it will build a 557 million euro ($632 million) automobile factory in Morocco with an annual production capacity of 90,000 units.

The plant, due to open in 2019 north of Rabat, will cater for "the needs of the region and of Moroccan customers," a statement said.

Chairman Carlos Tavares signed an official agreement with Industry Minister Moulay Hafid El Alamy in the presence of King Mohamed VI at his palace in the capital, an AFP journalist said.

The group said the plant "will by 2019 assemble engines and vehicles in the B and C segments" -- compact and mid-sized cars, the mainstay of Morocco's automobile industry.

"With a capacity of 90,000 engines and vehicles to begin with, this industrial unit will eventually produce 200,000 units a year, when demand requires," it said.

Alamy said the new factory would create 4,500 full-time and provide indirect employment for up to 20,000 workers.

PSA said it was "today preparing the conditions to realise its commercial ambition (to produce) a million vehicles in the Middle East and Africa region by 2025".
Source: AFP