MOSCOW -- Russia's biggest carmaker, Avtovaz, said on Tuesday it had agreed with General Motors to produce Opel Astra cars at their joint venture plant.
The company also said it planned to issue a $100 million Eurobond this year to help finance production from the beginning of 2004.
"We reached an agreement in principle on production of the Opel Astra at the joint venture," Vladimir Kadannikov, head of Avtovaz's board of directors, told reporters.
Opel Astra would be the second model for the $322 million venture, which the two companies launched at the end of September 2002 to produce the Chevrolet Niva off-road vehicle.
The head of GM in Russia, Heidi McCormick, declined to comment on Kadannikov's statement. GM had said in October that it would decide early in 2003 whether to start producing a second model at the plant.
Kadannikov has said the joint venture, located in Togliatti, south-east of Moscow, needs $1.05 billion over the next five years. The Eurobond would contribute part of that financing.
"We're working on (the Eurobond). There are lots of documents to prepare. We're trying to wrap things up this year and issue the $100 million Eurobond at the start of next year," Kadannikov said.
Avtovaz has already said it plans to issue about $100 million in credit-linked notes this year along with rouble bonds to finance a one-year billion rouble ($31.9 million) bond placed at the end of February.
The Togliatti plant began production last year and should reach capacity of 35,000 Chevrolet Nivas this year.
At full capacity it will produce 75,000 cars a year, up to 40,000 of which will be for export.