Volvo Cars has announced 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 over US$1.1bn 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.
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“The continued expansion of our plant in South Carolina is another significant commitment to the US market,” said Håkan Samuelsson, president and chief executive. “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 US 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.
Volvo says 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 company said.
The XC90 has played an important role in Volvo Cars’ sales revival in the US and around the globe. The flagship SUV, launched in 2014, helped Volvo Cars recover its sales in the US from a low of 56,000 units sold in 2014 to almost 83,000 units in 2016.
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By GlobalDataThe 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, 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.
