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PRAGUE, Mar 27 (Reuters) The Czech Republic has won the race to be the location of a major new car plant by South Korea's Hyundai Motor Co, company and Czech government officials said on Monday.

Kim In-seo, senior vice-president at Hyundai, told reporters the plant, expected to produce up to 300,000 vehicles a year, will require an investment of between 800 million and 1 billion euros ($963.4 million to $1.20 billion).

Czech Industry and Trade Minister said the government would give Hyundai 4.3 billion crowns ($180.8 million) in direct state support, and up to another 1.3 billion crowns in possible tax holidays. Even more breaks would be granted if the investment level rose above 1 billion euros, he added.

''Hyundai is coming to the Czech Republic,'' Urban said, adding a final deal should be signed on the investment by mid-May.

The Czech foreign exchange market has been on the lookout for confirmation of the deal with Hyundai, one of the biggest foreign direct investments in the EU newcomer's history. The crown was slightly firmer at 28.655 to the euro.

Hyundai and the Czech government have been negotiating for months over tax breaks, aid for job creation and other investment incentives for its plant, expected to be set up in a planned eastern industrial zone in Nosovice, near the north-eastern city of Ostrava.

The plant is expected to create 3,000 direct jobs and another 10,000 in spin-offs.

''The Czech Republic proved to be the right place for our project. We believe the Czech Republic is a tremendous country with skilled and capable people ... This location will provide an ideal strategic base for our European manufacturing operations,'' Kim In-seo said.

Social Democrat Prime Minister Jiri Paroubek -- in a heated election campaign where he is trailing the rightist opposition -- has advocated doing all it takes to lure Hyundai.

Hyundai aims to be among the world's top five car makers by 2010, along with its affiliate Kia, from number seven now, and wants to increase production in overseas markets to shield itself from a firmer won.

''The plant could bolster shares in Hyundai as the plant would be another momentum after its plant in the U.S. It is very important for Asian auto makers to localise in overseas markets since it is difficult for them to grow only at home,'' said Kang Sang-min, an auto analyst at TongYang Investment Bank.

The government expects the plant, which should start operation in 2008, to boost economic growth by up to 2.5 per cent a year when full production is finally reached in 2009.

A booming auto industry propelled the Czech economy to 6 per cent growth last year, the fastest growth rate on record.

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