Mitsubishi Motors has confirmed plans to build a new vehicle assembly plant in Indonesia as it looks to strengthen its position in south-east Asia’s largest and most promising vehicle market.

The group’s chief executive, Osamu Masuko, in Japan said construction of a new US$600m factory will begin in May 2015 in Jakarta’s satellite city Bekasi. The new plant will bring the carmaker’s overall production capacity to 240,000 units per year.

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Production of a new compact MPV, the most popular segment in the local vehicle market, is expected to begin in 2017. The new purpose-designed vehicle will also be exported to neighbouring ASEAN markets, including Philippines, Thailand and Vietnam.

Mitsubishi Motors currently produces the Outlander SUV in Indonesia, although volumes have remained limited since its launch in 2012. Most of the company’s sales are generated from vehicles imported from Thailand.

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