Apollo Tyres plans to spend EUR442.2m (US$572m) to set up a tyre plant in Hungary.

Press Trust of India reported the plant would be located in Gyongyoshalasz, in northern Hungary, and is expected to create more than 975 jobs.

The company has received investment aid of EUR95.7m from Hungary for the plant. The aid includes tax allowances of around EUR44.7m, an employment grant of EUR2.8m and a direct grant of EUR48.2m.

The aid was approved by the European Commission in line with EU state aid rules.

Joaquin Almunia, commission vice president in charge of competition policy, said: "Apollo Hungary's investment project is expected to create 975 new jobs in Gyongyoshalasz. It will contribute significantly to the development of the region without unduly distorting competition in the single market."

The company expects to make 675,000 heavy commercial vehicle tyres and 5.5m passenger car tyres each year at the plant.