Volvo Cars announced today it will establish a third manufacturing plant in Europe. This will position the company well to meet the continued demand from its customers for electric vehicles (EVs) and capture future growth potential.
The new state-of-the-art plant will be climate neutral and build only electric cars. This underpins the company’s ambition to become fully electric by 2030 and climate neutral by 2040.
By picking Slovakia as the location for its new plant, Volvo Cars creates a European triangle of manufacturing covering its largest sales region. It joins the brand’s in plant in Ghent (Belgium) in western Europe and the Torslanda plant (Sweden) in northern Europe.
The new €1.2 billion facility will be located close to Kosice, in the eastern part of Slovakia. Here, it will benefit from a well-established automotive supply chain as it becomes the fifth car plant in the country.
Jim Rowan, Volvo Cars chief executive, said: “We have a clear focus on becoming a pure electric mobility brand by 2030, which is in line with our purpose.”
“Expansion in Europe, our largest sales region, is crucial to our shift to electrification and continued growth. I am very pleased to expand our Volvo Cars production footprint into Slovakia and look forward to welcoming new colleagues and partners on the journey ahead.”
Construction of the Kosice plant is planned to start in 2023, with equipment and production lines installed during 2024. Series production of next-generation, pure electric Volvo cars is scheduled to start in 2026.
Eduard Heger, Prime Minister of the Slovak Republic, said: “I appreciate that Volvo Cars has decided to build its new plant in Slovakia. The new Volvo Cars plant is important for us since it will improve the social and economic situation in the region and produce only electric cars, which provides the Slovak automotive industry with a competitive perspective in the new ecological era.”
In line with Volvo Cars’ ambition to have climate neutral manufacturing operations by 2025, the plant will use only climate neutral energy. It will also be designed to be a leader in sustainable and efficient premium electric car production with an optimised layout and logistics flow, while Volvo Cars aims for the highest global standards in energy and environmental efficiency.
Richard Sulik, Minister of Economy of the Slovak Republic, said: “Personally, I am very pleased that Slovakia has succeeded in the competition for this mega investment, which will bring development and many jobs in the eastern part of Slovakia, with lots of direct and indirect job opportunities.”
As for the location, Kosice offers good logistical and transport links to the rest of Europe and access to a good supplier base. The incentives offered by the Slovak government have also been a key factor in the decision to locate the plant in Kosice.
The facility is designed to produce up to 250,000 cars per year and is expected to provide several thousand new jobs in the region. The site also allows for further expansion of the plant in future.
Javier Varela, Volvo Cars CEO, said: “We look forward to welcoming new members to the Volvo Cars Kosice team and the global Volvo Cars family, as well as establishing new collaborations and partnerships in the region. It will be a modern workplace, in a state-of-the-art plant that centres on sustainability and safety.”