Moscow - General Motors, the world's largest automaker, on Friday opened a 300-million-dollar factory, its first fully-owned venture in Russia.

GM joins five other foreign carmakers with plants in the outskirts of St Petersburg, an area coming to be known as the new Detroit of the automotive industry, as firms hope to compensate for slumping sales in Europe and North America.

The factory will produce 60,000 Chevrolet Captiva sports utility vehicles a year and 10,000 of the Opel Astra model a year. It is also expected to begin production of the Chevrolet Cruze compact car next year.

"We have made a decision to go forward with the 300-million-dollar investment as we trust in the potential of growth of the Russian market which, for us, is extremely important," Carl-Peter Forster, CEO of GM Europe, said at the opening ceremony, Interfax reported. "In the last five years we have considerably increased sales of our cars in Russia up to 30,000 units."

Russia will be GM's largest market in 2009, Forster said. It is now the best-selling foreign car maker in what industry experts have projected is the world's fastest growing car market.

But the financial crisis has thrown doubts on these estimates as Russian banks stopped issuing easy credit for car purchases, stalling sales.

GM is facing one of its worst years ever as market watchers waited for the US auto giant to announce billions of dollars in third- quarter losses Friday after appealing to Washington for loans.

The St Petersburg region has become an industry manufacturing centre with Ford and Toyota already running factories there while Nissan, Hyundai and Suzuki are to begin production soon.

GM now produces about 100,000 units a year in Russian joint ventures. (dpa)