Volvo Cars, the premium car maker, today announces that the next generation of the XC90 large premium SUV will be built in its new manufacturing plant in Charleston, South Carolina, from 2021. This takes Volvo Cars’ total investment in its US manufacturing operations to more than USD 1.1 billion and will raise the total of new jobs created at the Charleston site to nearly 4,000.
The South Carolina plant will start production of the next-generation S60 in the autumn of 2018. The addition of the next-generation XC90 from 2021, as well as a planned new office campus, will create 1,900 new jobs, which come on top of the 2,000 new employees currently being hired.
“The continued expansion of our plant in South Carolina is another significant commitment to the US market,” said Håkan Samuelsson, President and Chief Executive of Volvo Cars. “The plant in Charleston will serve both the US and international markets, and forms a strong foundation for our future growth in the US and globally.”
Volvo Cars announced in May 2015 that its first ever manufacturing plant in the United States would be located just outside Charleston in South Carolina. The decision to choose South Carolina was taken as a result of its easy access to international ports and infrastructure, a well-trained labour force, an attractive investment environment and experience in the high-tech manufacturing sector.
The business logic behind the decision to build the next-generation XC90 in South Carolina is compelling. The US is the largest single market for the XC90, although a considerable amount of XC90 volume will be exported from the Port of Charleston. Total US production capacity at the plant will rise to 150,000 vehicles annually.
The XC90 has played an important role in Volvo Cars’ sales revival in the United States and around the globe. The widely acclaimed large SUV, launched in 2014, is the most awarded luxury SUV of the century, and helped Volvo Cars recover its sales in the United States from a low of 56,000 units sold in 2014 to almost 83,000 units in 2016.
Today’s announcement on further expansion in South Carolina allows Volvo Cars to take another step toward the company’s ‘build where you sell’ global manufacturing strategy. It currently operates two manufacturing plants in Europe, as well as two factories in China. A third Chinese plant is currently under construction.
In addition to expanding the manufacturing plant, Volvo Cars will further develop its neighbouring office campus at the Charleston site. A new office building will be constructed to house up to 300 staff from R&D, purchasing and quality, as well as Volvo’s Southern Regional Sales team.
“We’re excited to add a second car to our first American factory, and we continue to be impressed by the entrepreneurial spirit in South Carolina,” said Lex Kerssemakers, President and CEO of Volvo Car USA. “Our business in the US has been undergoing a transformation over the past two years, and this is an important next step for our development here.”
While Volvo Cars will employ up to 4,000 people directly at the South Carolina site, the full economic impact on the local economy will be much greater once the job multiplier effect is included.
Volvo Car Group in 2016
For the 2016 financial year, Volvo Car Group recorded an operating profit of 11,014 MSEK (6,620 MSEK in 2015). Revenue over the period amounted to 180,672 MSEK (164,043 MSEK). For the full year 2016, global sales reached a record 534,332 cars, an increase of 6.2 per cent versus 2015. The record sales and operating profit cleared the way for Volvo Car Group to continue investing in its global transformation plan.
About Volvo Car Group
Volvo has been in operation since 1927. Today, Volvo Cars is one of the most well-known and respected car brands in the world, with sales of 534,332 cars in 2016 in about 100 countries. Volvo Cars has been under the ownership of the Zhejiang Geely Holding (Geely Holding) of China since 2010. It formed part of the Swedish Volvo Group until 1999, when the company was bought by Ford Motor Company of the US. In 2010, Volvo Cars was acquired by Geely Holding.
As of December 2016, Volvo Cars had more than 31,000 employees worldwide. Volvo Cars’ head office, product development, marketing and administration functions are mainly located in Gothenburg, Sweden. Volvo Cars’ head office for China is located in Shanghai. The company’s main car production plants are located in Gothenburg (Sweden), Ghent (Belgium), Chengdu and Daqing (China), while engines are manufactured in Skövde (Sweden) and Zhangjiakou (China), and body components in Olofström (Sweden).