SEOUL, South Korea (AP) - Hyundai Motor Co. said Friday it plans to build its first European auto manufacturing plant in the Czech Republic to increase its presence in the European market.

Hyundai Motor will spend 1 billion euros ($1.2 billion) for the plant, likely to be built in Ostrava, near the border with Poland, South Korea's largest automaker said in a statement.

"We hope the Czech government will provide close support for us to decide on the plant site and establish infrastructure, and offer some investment incentives," said Chung Mong-koo, chairman of Hyundai Motor, in his meeting with Czech's Prime Minister, Jiri Paroubek, earlier Friday, according to the statement.

The automaker plans to begin construction of the plant next year and start mass production in 2008.

Hyundai Motor, which recently established its first U.S. plant in Alabama, expects the new plants will help improve its competitiveness by easing foreign-exchange risks and reducing costs.