UPDATE 2-GM to invest $336 mln in Volt assembly plant

* $336 mln investment in Volt final assembly plant

* Up to 10,000 vehicles in first year of production
(Adds background on Volt production target, price)

DETROIT, Dec 7 (Reuters) - General Motors Co [GM.UL] will
invest $336 million in a Detroit-area plant to produce its
heavily anticipated Chevrolet Volt electric car beginning next
year, the No. 1 U.S. automaker said on Monday.

Assembly of Volt prototype vehicles will begin in the
spring at GM's Detroit-Hamtramck assembly plant, with the
regular production scheduled for late 2010, GM said.

The plant currently employees about 1,200 workers,
including 1,100 hourly workers represented by the United Auto
Workers union.

GM said the investment brings the automaker's combined
spending in Michigan related to the Chevy Volt plug-in car to
$700 million.

GM is counting on the Volt and other upcoming
fuel-efficient vehicles such as the Chevy Cruze small car to
revitalize its lineup as it restructures after emerging from
bankruptcy in July.

The Volt is designed to run for 40 miles from a single
charge of a lithium-ion battery pack. When the battery is
depleted, a small combustion engine kicks in to recharge the
battery and power the vehicle.

The Volt, set to go on sale in November 2010 in the United
States and later in Europe, has attracted intense interest as
one of the first rechargeable, battery-powered vehicles set to
launch in the United States.

But GM officials have also downplayed expectations for the
Volt's commercial success because of the vehicle's steep
development costs, high sticker price and limited production.

GM Vice Chairman Bob Lutz said last week at the Los Angeles
auto show that he sees limited sales of electric cars over the
next five years and that GM will ramp up output of the Volt
plug-in cautiously.

GM would build 8,000 to 10,000 Volt models during the first
full year of production, with an eventual ramp-up to 50,000 to
60,000 units annually, Lutz said.

GM executives have said the Volt could cost about $40,000
before a consumer tax rebate of $7,500.
(Reporting by Soyoung Kim, editing by Matthew Lewis)