Russia’s RM Systems has signed an agreement with Japan’s T. RAD to build a $US30m plant in the Russian city of Nizhny Novgorod to produce vehicle radiators and heat exchangers, the Russian company said.

RM Systems and T. RAD Co. are expected to control the plant, opening in early 2009 on a 50-50 basis, according to a Prime-Tass news agency report.

The facility is expected to produce about 600,000 units per year during the first stage. Sales are projected between $30m and $35m.

During the first stage, the facility is expected to supply Russian automaker GAZ but later will expand to other automakers in Russia, both domestic and foreign.

RM Systems is a wholly owned subsidiary of Russian Machines, which is controlled by Basic Element group.

T. RAD manufactures heat exchangers for vehicle, construction machines, air conditioners and industrial machines.