General Motors Corp. officially breaks ground on a new $115 million greenfield manufacturing plant near St. Petersburg, Russia, with plans to ramp up production there to 25,000 vehicles by the end of 2008.

“This project clearly demonstrates our commitment to Russia as one of the world's fastest-growing auto markets,” GM Chairman and CEO Rick Wagoner says during a groundbreaking ceremony today in the Shushary region outside St. Petersburg.

“With the addition of this new, wholly owned facility, GM and its partners will be able to assemble more than 100,000 cars a year in Russia.”

The plant, GM’s third assembly facility in Russia, is scheduled to begin output in 2008, with full-year capacity expected to reach 25,000 units. It will produce Chevrolet Captiva cross/utility vehicles and a new generation of compact cars from complete-knocked-down kits. The Captiva is built by GM Daewoo Auto & Technology Co. in South Korea.

GM says a separate semi-knocked-down facility in the city of St. Petersburg will begin operation as soon as September. That facility will assemble Captivas until the Shushary facility is ready to begin production.

GM says its sales grew 41.7% in Russia during the first five months of the year.

GM already has a joint venture to produce the Chevy Niva SUV and Viva sedan with Russian car maker OAO AvtoVAZ. But recent media reports have chronicled a deteriorating relationship between the two partners. Russian manufacturer ZAO Avtotor also assembles some GM models.