Dell is considering opening its second European production plant to cope with increased demand in the region, according to its founder and chairman, Mr Michael Dell.

The computer manufacturer yesterday confirmed reports of a speech by Mr Dell in which he said the firm was considering setting up a new plant in Europe.

Mr Dell did not specify in what country the plant would be located, although the firm moved yesterday to quash speculation that it was looking at France.

The proposed production plant would be in addition to the firm's existing plant in Limerick which employs more than 3,000 staff, said a Dell spokeswoman.

"With continued strong growth in the region, it is reasonable that in time Dell will require additional manufacturing capacity, however neither a location nor a timeframe has been agreed and at this time our European manufacturing facility in Limerick currently has capacity to serve the region."

It remains unclear whether Dell would consider expanding its existing Irish plant rather than establishing a greenfield plant overseas.

But high costs in the Republic and logistical considerations could rule against this.

Dell has been experiencing 30 per cent growth in Europe, Middle East and Africa over the past year as it increases its market share in the region.

The European plant expansion would follow a move last month to add a third major manufacturing location in the US, in a rare example of a technology firm expanding in its home market.