Feasibility studies for the location are being carried out and construction should begin in the first quarter of 2010, the government investment agency said in a statement.

It also said Korean steel manufacturer Posco would make an initial greenfield investment in Turkey of $24 million to produce annually 170,000 million tonnes of flat steel, to be used primarily for the automotive sector.

Hyundai Assan, a joint enterprise between carmaker Hyundai and Turkey's Kibar Holding, announced on Wednesday it had chosen Turkey as the site for production of its new i20 series.

Toyota, Renault and Ford are also present in Turkey.