* Company to invest in Mercedes-Benz plant in Kecskemet
* Strong demand for compact luxury cars drives expansion
* Hungarian plant could produce new compact model
By Gergely Szakacs
KECSKEMET, Hungary, Jan 20 (Reuters) - Daimler AG plans to invest more and boost output at its Mercedes-Benz factory in Hungary due to strong demand for luxury compact cars, a company executive said on Tuesday.
"We have invested a billion euros ($1.2 billion) into this factory and we will invest more," Thomas Geier, head of the Kecskemet plant in central Hungary, told a news conference through an interpreter.
He did not specify how much more Daimler would invest or how much output would rise at the factory, which produced 150,000 cars in 2014.
Geier said strong demand for compact Mercedes-Benz models, including the B-class and CLA models made at Kecskemet, was behind the decision to boost output at the factory.
"We will invest in the future as the compact car family develops further," he said. "There will be a new series and the Kecskemet factory will take part in this actively."
The German premium carmaker launched serial production of a new model, the CLA Shooting Brake, on Tuesday.
Geier also said Daimler was in talks with the government of Prime Minister Viktor Orban about subsidies compliant with European Union regulations.
The company employed about 4,000 workers in Hungary at the end of last year, according to a press release. The Kecskemet plant opened in March 2012. ($1 = 0.8642 euros) (Reporting by Gergely Szakacs; Editing by Sam Wilkin)