Oslo, July 1 (BNA): Sweden-based Volvo Cars said today, Friday, that Volvo Cars Group will invest 1.2 billion euros ($1.25 billion) to build an electric car plant in Slovakia.
The site, fifth in Slovakia, will cement its position as the world’s largest per capita car producer, with the central European country of 5.4 million cars producing more than 1 million vehicles in 2021.
For Volvo Cars, it will be its third plant in Europe and will only build electric vehicles, in line with the company’s ambition to produce exclusively electric vehicles by the end of this decade.
Reuters said the European Union aims to phase out sales of new fossil-fuel cars by 2035.
“Expansion into Europe, our largest sales region, is critical to our transition to electrification and continued growth,” CEO Jim Rowan said in a statement.
The facility located in the Kosice region in eastern Slovakia is designed to produce up to 250 thousand cars annually. The company said in a statement that the plans also allow for future expansion.
“Volvo Cars has the ambition to move towards annual sales of 1.2 million vehicles by the middle of the decade, which aims to keep pace with its global manufacturing footprint covering Europe, the United States and Asia,” it said.
The investment will create 3,300 jobs across the city of Kosice, 100 kilometers (62 miles) from the border with Ukraine.
The region has always had high unemployment rates compared to the western part of the country.
“I am pleased that Slovakia has succeeded in competing for this huge investment that will bring development and many jobs to eastern Slovakia,” Economy Minister Richard Solek said in a statement.
Volvo Cars’ other European factories are located in Belgium and Sweden.
Its production rose last year by 5.6% to nearly 700,000 vehicles, 27% of which are either all-electric or plug-in hybrids.
The company, which is majority owned by China’s Geely Holdings, was listed on the Nasdaq Stockholm stock exchange last October.
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