Slovakia is close to a deal with Ford to build a car parts plant for up to €400 million, sources close to the deal told Reuters on Tuesday.

"There are still some issues to be negotiated, but we expect the deal to be finalised by Thursday," a source, close to the government, reportedly said.

According to Reuters, the source said that Ford planned to invest between 300 and 400 million euros in the greenfield plant, which would be located in eastern Slovakia.

Another source told Reuters that the plant would make engines, engine parts and gear boxes.

"We don't comment on rumours and speculation," a Ford of Europe spokeswoman in Germany told the news agency.

Reuters noted that Slovakia has become the engine for Europe's automotive industry over the past few years, luring car makers with its proximity to European markets, cheap labour force and low tax rate. The Ford plant would be the third major auto investment into the new EU member state in the past two years.