General Motors Powertrain plans to double engine manufacturing capacity at its Hungarian plant by 2013 from the current 460,000 units per year, daily Nepszabadsag said on Tuesday without naming sources.

The paper said the factory, which employs 600 workers and 350 contractors, would expand production by four new engine models which could create another 700 to 800 jobs in the western town of Szentgotthard, Reuters reported.

But a spokeswoman for GM Powertrain Hungary told the news agency GM had made no firm decision about the investment yet.

"There is no project decision so far," Edit Legradi said. "For the time being this is an opportunity that may end up in Szentgotthard or another factory in Europe." She declined to comment about the cost of the investment.

GM Powertrain, which currently makes 1.6 and 1.8 litre petrol engines in Hungary, plans to make 220,000 engines and 270,000 cylinder heads this year, the paper said.

It also said Audi, which recently bought a new plot of land next to its factory in the western town of Gyor, would also expand production in Hungary from 2012.

Nepszabadsag added construction of a new EUR800m Mercedes plant in the town of Kecskemet was going according to schedule. That investment is expected to create 2,500 jobs directly, the paper said.