GENEVA: Japanese car maker Nissan says it is investing 125 million pounds ($198 million) at its British factory to build a new compact car.

Nissan said Tuesday at the Geneva Motor Show that the new model, called "Invitation," would compete with cars including the Ford Fiesta and Volkswagen Polo. The new model is to debut next year.

The company says the program will create 2,000 jobs in the industry including 400 more workers at its U.K. factory in Sunderland in northern England, raising employment there to a record 6,000.

The British government is supporting the investment with a grant of 9.3 million pounds.

Nissan's U.K. operation had a record year in 2011, with production up nearly 14 percent to 480,000 vehicles.