Volvo Cars to set up its first plant in the US

Volvo Cars has announced today that it is to build a brand new manufacturing facility in the US, investing around 500 million dollars (Rs 3,158 crore) in a new plant. 

The company says it has drawn up a short list of potential locations and full details of the location of the new factory and the size of the investment will be announced at a later date.

The move means Volvo is now a global car manufacturer with an industrial footprint on all three key continents. It has two factories in Europe, two in China and the future plant in the US, which will be part of the Americas region that was announced in January. These developments form part of Volvo’s transformation that has been ongoing since 2010. Volvo’s US revival comes alongside strong growth in China and Western Europe. 

The transformation plan involves the creation of a global industrial footprint, the complete renewal of Volvo’s product range over the next four years, the introduction of a new modular vehicle technology, the development of world-first safety technologies, a new design language and a range of class-leading connectivity services.

“Volvo Cars cannot claim to be a true global car maker without an industrial presence in the US. Today, we became that,” said Håkan Samuelsson, chief executive and president. “The US is an absolutely crucial part of our global transformation and today’s announcement makes it perfectly clear that Volvo is in the US to stay.”

Volvo Cars has been doing business in the US since 1955. The new plant also means Volvo will be able to meet and ultimately exceed its volume targets in the US, where it has a medium term ambition to sell 100,000 cars a year. It will help accelerate the introduction of build-to-order in the US as well as being an integral part of Volvo’s global manufacturing footprint, serving the US and export markets, and also help limit the impact of currency variations.

“The US Volvo dealers are delighted with this announcement,” said Chip Gengras, chairman of the Volvo dealer council in the US. “It clearly illustrates Volvo's long term commitment to the US market.”