PSA Peugeot Citroen's key factory in Vigo, northwest Spain, expects to build 500,000 cars in 2012 when it should be assembling three new models, according to trade union officials who added the site is close to winning the contract to assemble a new electric car.

Their comments come after Citroen's general manager Jean Mark Gales this week said the undisclosed emerging markets "core range" car the factory is to begin building in the short term will not be a "low cost" model. This is despite the French automobile group's decision to choose Vigo because of its lower cost base and high efficiency rates. 

"This is most likely going to be a mid-range sedan with the necessary security and comfort elements," an official at Spanish union CCOO told just-auto, adding he could not provide more details.

The car will be sold in the Mediterranean basin and the Middle East and Africa, both as a Peugeot and a Citroen.

The 7,000-worker Vigo facility has enjoyed plenty of good news lately. Apart from the developing markets model, there is a growing possibility that PSA will award the factory the assembly of a new electric vehicle "very soon," the union official added. 

Spanish press has speculated the car will be manufactured on the Berlingo and Partner van assembly line and would be launched well into 2012 with initial annual output of 2,000 units. In a sign of the project's certainty, Japan's GS Yuasa announced plans to establish a lithium-ion battery factory in Galicia (where Vigo is located) or nearby Asturias that would make 50,000 units a year for PSA, Ford, BMW and GM electric models.

PSA also began making the revamped Citroen C4 Picasso MPV/minivan line at the factory recently.

Looking ahead ahead, the union official commented: "All these projects are going to enable us to make 500,000 cars in 2012 and probably keep that level thereafter." 

He added PSA will also revive the third manufacturing shift withdrawn in 2009 when the global economic slowdown forced Vigo to cut production. 

Vigo makes several key PSA models including the Citroen C4 and Grand C4, Xsara Picasso, Berlingo, Peugeot Partner, Partner Origin and New Partner. 

This year, the factory is forecast to churn out 394,000 cars, up from an earlier forecast of 348,000, as the Spanish Plan 2000E subsidy programme helped lift sales to record highs in the first half.