Paccar Inc plans to invest around $200 million over two years to build a truck factory in Brazil, Valor Economico newspaper reported.

The company wants to produce three models of trucks under its brand DAF, Paccar's Treasurer Robin Easton was quoted by Valor as saying.

Demand for trucks has been strong in Brazil.

Sales rose 26.8 percent in the first quarter of 2011 from a year ago and could continue to improve ahead of the introduction in January 2012 of new legislation that sets stricter environmental rules for truck engines.

The Bellevue, Washington-based company in April reported a first-quarter profit of $193 million, or 53 cents a share, sharply above the $68.3 million, or 19 cents a share, it earned a year earlier. (Reuters)