The Swedish carmaker Volvo Car Group said on Friday that it will invest 1.2 billion euros ($1.25 billion) in the construction of an electric vehicle (EV) facility in Slovakia.
By producing more than 1 million automobiles in 2021, Slovakia, a country of 5.4 million people in central Europe, would strengthen its position as the largest automaker globally.
It will be Volvo Cars’ third facility in Europe, and it will only make electric vehicles, in keeping with the company’s goal of producing only electric vehicles by the end of this decade.
By 2035, the European Union wants to phase out the sale of new fossil fuel vehicles.
In a statement, Chief Executive Jim Rowan stated that “expansion in Europe, our largest sales market, is critical to our move to electrification and future development.”
The factory in Slovakia’s eastern Kosice area can make up to 250,000 automobiles annually. The plans also permit for potential future growth, the business stated in a statement.
By the middle of the decade, Volvo Cars hopes to sell 1.2 million vehicles annually. To achieve this goal, the company plans to expand its production operations throughout Asia, Europe, and the US.
3,300 employment will be created in the area of Kosice, which is 100 kilometers (62 miles) from the Ukrainian border.
Compared to the western region of the country, the region has traditionally experienced significant unemployment.
Richard Sulik, Slovakia’s economy minister, said in a statement: “I am extremely delighted that Slovakia prevailed in the competition for this massive investment that will bring growth and many employment to the east of Slovakia.
The other European factories for Volvo Cars are in Sweden and Belgium.
Its output increased by 5.6 percent to over 700,000 vehicles in 2017; of those, 27% were plug-in hybrids or completely electric vehicles.
The majority-owned Chinese corporation, Geely Holding, listed the business on Nasdaq Stockholm in October.
