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 Mexican President Felipe Calderon led groundbreaking ceremonies for the factory, which will be financed by an arm of Mexican conglomerate Grupo Salinas and China's state-owned FAW Group Corp., one of the nation's largest automakers.
"Most of the world's investments used to go to China, and today China has come to invest in our country because it recognizes an enormous opportunity in Mexico thanks to its domestic market" and proximity to the U.S. and Latin America, Calderon said.
Due to open by 2010 in Michoacan state, the plant is expected to churn out 100,000 cars a year for sale in Mexico and Central America, according to a statement from Grupo Elektra, Grupo Salinas's electronic goods and consumer financing unit.
Grupo Elektra and FAW are investing $150 million to construct the factory, which is expected to employ some 4,000 people and bring up to 20,000 additional jobs to the local economy, Javier Sarro Cortina, head of Grupo Salinas Motors, said Friday.
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 FAW-line cars will start selling in Mexico early next year for as much as 10 percent less than the current market average, Grupo Elektra said.
The cars will retail for as low as $6,280, Grupo Salinas chairman Ricardo Salinas Pliego said at the groundbreaking.
Chevrolet's smallest Chevy sedan, one of Mexico's most affordable cars, sells for about $7,100.
[Associated Press]
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