The next generation XC90 will be built at Volvo Cars’ new manufacturing plant in Berkeley County, South Carolina beginning in 2021. The announcement brings Volvo’s total U.S. investment in manufacturing to just over 1.1 billion.
“The continued expansion of our plant in South Carolina is another significant commitment to the US market,” said Håkan Samuelsson, President and Chief Executive, Volvo Cars. “The plant in Charleston will serve both the U.S. and international markets and forms a strong foundation for our future growth in the U.S. and globally.”
In the fall of 2018, S60 production will begin at Volvo’s new South Carolina facility. To support production, 2,000 new employees are being hired but with plans to build the XC90 in South Carolina, another 1,900 jobs are expected. Volvo says the full economic impact will be much greater once the plant is fully operational and the “job multiplier” effect is accounted for.
Volvo’s manufacturing strategy is based on a “build where you sell” approach. Concerning the XC90, the U.S. is the largest market for the SUV, although a considerable number of units will be exported from the Port of Charleston. Total U.S. production capacity at the plant will rise to 150,000 vehicles annually Volvo predicts.
Prior to the XC90’s arrival, some felt Volvo’s presence in the U.S. was lackluster. When the XC90 arrived for Volvo retailers and dealer principals in 2015, it was often met with open arms and seen as something that could revive the brand for American buyers. Indeed it proved to be that, winning a number of awards and jumping U.S. sales from a low of 56,000 units in 2014 to almost 83,000 in 2016.
In addition to the Charleston plant, Volvo is planning a neighboring office campus to house up to 300 staff from R&D, purchasing, quality, and the regional sales team. Volvo Cars announced in May 2015 – just as the XC90 was hitting the U.S. – that its first ever manufacturing plant here would be located just outside Charleston, South Carolina. Volvo cited direct access to international ports and infrastructure, a well-trained labor force, an attractive investment environment, and experience in the high tech manufacturing sector as the primary reasons to come to South Carolina.
“We’re excited to add a second car to our first American factory in South Carolina 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 U.S. has been undergoing a transformation over the past two years and this is an important next step for our development here.”
Carl Anthony is Managing Editor of Automoblog and resides in Detroit, Michigan.