Nov. 7 (Bloomberg) -- General Motors Corp., the world's biggest carmaker, opened a $300 million factory in Russia as it looks to compensate for slumping sales in western Europe and North America.

The plant in the Shushary district on the outskirts of St. Petersburg will produce 70,000 Chevrolet Captiva sport-utility vehicles and the Opel Astra, with plans to manufacture the Chevrolet Cruze compact car next year.

``Our strategy is to become the leading manufacturer in Russia,'' Carl-Peter Forster, GM's chief for Europe, told reporters during the plant opening today. ``For us Russia is not an emerging market. Russia emerged long ago.''

The new plant ``is an example of a good investment project that's oriented toward the future,'' Russian President Dmitry Medvedev told reporters. He called on GM to boost output at the plant.

Forster said the production schedule won't be revised now as the car market has soured. The new plant will employ 981 people, and that may increase to 1,700 next year.

Russia will become GM's biggest car market in Europe in 2009, Forster said. GM boosted its market share in Russia this year to 10.9 percent from 6.5 percent in 2006. The Chevrolet Lacetti is Russia's second best-selling foreign-brand car after Ford's Focus.

Joint Ventures

GM already produces 100,000 vehicles a year in joint ventures with ZAO Avtotor in Kaliningrad and OAO AvtoVAZ in Togliatti.

U.S. auto sales may fall next year to the lowest level since 1991. GM, Ford Motor Co. and Chrysler LLC have requested $50 billion in U.S. federal loans to help the companies weather the crisis.

GM follows five other foreign automakers with plants near St. Petersburg. Toyota Motor Corp., the world's second-largest automaker, and Ford operate assembly factories near Russia's second-biggest city. Nissan Motor Co., Hyundai Motor Co. and Suzuki Motor Corp. are building facilities in the area.

Russia surpassed Germany as Europe's biggest car market in the first half as sales rose 41 percent, according to PricewaterhouseCoopers LLP.

To contact the reporter on this story: Paul Abelsky in St. Petersburg at pabelsky@bloomberg.net

Last Updated: November 7, 2008 11:06 EST