Volvo Adds XC90 Production to U.S. Plant Plan
Volvo announces plans to add XC90 SUV production at its plant in South Carolina, boosting its investment to $1.1 billion. The plant begins building S60 sedans in fall 2018 and adds XC90 in 2021.
Volvo says it will increase production capacity at its South Carolina plant to 150,000 vehicles annually, adding a second line to assemble the next-generation XC90 large CUVs starting in 2021.
The plant in Ridgeville, SC, about 35 miles (56 km) outside the port city of Charleston, is slated to begin building S60 sedans next fall. About half of that 60,000-unit annual production will be exported.
Volvo officials in April said a second vehicle line for the plant would boost annual capacity to 120,000 units, but the latest announcement pushes that number higher. Volvo says although the U.S. is its largest market for the XC90, the automaker plans to export “a considerable volume” of the CUVs built at the plant.
“The continued expansion of our plant in South Carolina is another significant commitment to the U.S. market,” says Håkan Samuelsson, president and CEO. “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.”
The XC90 is now built at the Chinese-owned automaker’s plant in Torslanda, Sweden. Of the 82,724 Volvos sold in the U.S. in 2016, 32,526 were XC90s, according to WardsAuto data. Overall U.S. deliveries improved 5.0% in August, but U.S. sales were off 7.3% through August this year, with the supply-constrained XC90 down 19.0%.
The additional production brings Volvo’s U.S. investment to about $1.1 billion at the South Carolina plant, which is expected to employ nearly 4,000 workers when it is fully operational.
The added capacity will fuel the company’s plan to increase U.S. sales to 150,000 units in the next few years. Volvo sold 534,332 units globally in 2016, a number the company projects to rise to 800,000 by 2020. Sales were up 8.7% through August, Volvo reports.
“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,” says Lex Kerssemakers, outgoing 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.”
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