FRANKFURT (AP) -- German carmaker Daimler AG said Thursday its new Smart fortwo electric car will be produced at its plant in Hambach, France.
Stuttgart-based Daimler said the car will be available at the end of this year, but large-scale production will start in 2012.
The first 1,000 cars produced this year will be provided to customers participating in test projects in major cities in Europe and the U.S. in order for Daimler to get feedback about everyday use of the cars which Daimler says has "the most modern lithium-ion battery."
Daimler said in a statement it will invest a double-digit million euro amount at the Hambach plant, in Northwest France, for production of the model.
French President Nicolas Sarkozy who attended the announcement ceremony in Hambach Thursday, said the French government will support the project.
Further support is to be extended by local governments in the Lorraine and Moselle regions. The measures will comprise a total of 15 percent of the investment, Daimler's statement said.
"The smart fortwo electric drive proves that emission-free driving in an urban environment is already feasible today," Daimler Chief Executive Dieter Zetsche said.
"With our decision to locate production here at the parent plant in Hambach, we are setting the course both for series production of electric vehicles and for the future of this highly innovative assembly plant."
Shares of Daimler were up about 2 percent at euro34.19 in Frankfurt afternoon trading.