Continental AG will spend up to €60 million to build a brake plant in Slovakia, joining other major car makers investing in the new member of the European Union.

The plant will be built in the central Slovak town of Zvolen, the company said, according to Reuters. Production will start in late 2005 and employ 500 people over the next five years.

“The investment will amount to up to €60 million over the next five years to create a facility making high performance front and rear brake disc callipers,” the company reportedly said.

According to Reuters, Continental ranks itself Europe’s second-largest automotive systems supplier by sales, with annual sales of €11.5 billion.

“Slovakia was chosen for the new facility on the basis of labor costs and transport costs to Continental’s key customers in Europe,” the company said.

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Kia Motors and PSA Peugeot Citroen are also building car factories in Slovakia, Reuters noted.