On Thursday, August 27, General Motors was set to sign an agreement with the western Indian state of Maharashtra to open an engine and transmission plant to be located in Talegaon.

GM already has a second vehicle plant in Talegaon that will begin operations next week. A spokesman for the company, in describing the new venture, said, "It is an extension of the investment GM has made in Talegaon for the vehicle facility."

The Chevrolet Aveo, Chevrolet Tavera, Chevrolet Optra , and Chevrolet Spark are already manufactured in India in Gujarat. The facility that will begin operations next week will have a capacity of 140,000, boosting GM's overall capacity in India to 225,000.

With the sale of passenger vehicles per year in India estimated to reach 2 million units by 2010, the country represents a ripe market for GM, especially in the genre of small cars.

GM will be in direct competition there with the Nano, a product of Tata Motors costing roughly $2,283 per car and set to launch in October.

Rival automaker Ford also began operations in May at its engine assembly plant in Chennai, located in southern India. That facility is expected to reach an eventual capacity of 250,000 units.