German automaker Volkswagen on Friday announced a plan to invest $650 million in an Argentina plant where it will manufacture a new sport-utility vehicle, according to a statement released by the government.
Business-friendly President Mauricio Macri, who ushered Argentina out of recession in 2016, has encouraged foreign investment especially after his center-right coalition's wins in last month's midterm elections.
Production of the SUV is anticipated to begin in 2020.
In a televised statement Macri noted that one year ago the government, companies and unions agreed to produce on million cars per year.
The president stressed that in 2017 Argentina has sold more than 780,000 cars, with record sales of trucks "which means production is moving, construction is moving."
Automotive factories produced nearly 393,650 units from January to October, according to Argentina's Association of Automotive Factories, 2.1 percent more than in the same period in 2016.
In those 10 months the sector commercialized 714,864 vehicles with a year-on-year increase of 21.8 percent in total sales, the group said.