Volvo Car Group will invest 1.2 billion euros ($1.25 billion) to build a new manufacturing plant in Slovakia as part of its expansion plans, the Sweden-based automaker said on Friday.
The new plant, Volvo Cars’ third in Europe, will build electric vehicles (EV) only, in line with the company’s ambition to produce EVs exclusively by the end of this decade.
“Expansion in Europe, our largest sales region, is crucial to our shift to electrification and continued growth,” Chief Executive Jim Rowan said in a statement.
The facility in Kosice in eastern Slovakia is designed to produce up to 250,000 cars per year and is expected to provide thousands of jobs in the region, The site also allows for future expansion, the company said in a statement.
“Volvo Cars has an ambition to move towards annual sales of 1.2 million cars by mid-decade, which it aims to meet with a global manufacturing footprint spanning Europe, the United States and Asia,” it said.
Volvo Cars’ output last year rose by 5.6% to almost 700,000 automobiles, of which 27% were either fully electric or plug-in hybrids.
The company’s other European plants are in Sweden and Belgium.
The company, which is majority owned by China’s Geely Holding, listed on Nasdaq Stockholm last October.
($1 = 0.9573 euros)
(Reporting by Terje Solsvik, editing by Gwladys Fouche and Jason Neely)