Geely owned Volvo Cars said on Monday (30 March) it would build a factory in the US, “fulfilling its ambition to be a truly global car maker” and spending around US$500m to underscore “its long term commitment to the US market”.

The company has drawn up a short list of potential locations and full details of that and the size of the spend will be announced later.

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The move would give Volvo Cars an industrial footprint on all three key continents. It has two factories in Europe, two in China and the planned plant in the US which will be part of the Americas region that was announced in January.

The transformation plan begun in 2010 involves the creation of a global industrial footprint, the complete renewal of the 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 chief executive and president Håkan Samuelsson. “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 said the new plant means it 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 the global manufacturing footprint, serving the US and export markets, and also help limit the impact of currency variations.

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“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.”