Why Volvo is launching a $500 million factory in the US - Fortune
If Volvo Cars had followed the auto industry’s hottest manufacturing trend , the company would have selected a site for its newest factory in Mexico, the up-to-the-minute global hotbed for car making. But Volvo bucked the tide, choosing instead to locate just north of Charleston , South Carolina. But the South also offers what Volvo views as a key intangible: proof to U. S. consumers and dealers that it’s committed for the long term. The quintessentially Swedish carmaker has seen sales decline in the U. S. , as American consumers gravitate towards competitors, like BMW, Lexus, Audi and Mercedes-Benz. Volvo sales were 56,366 last year, from a peak of 139,384 in 2004. The $500 million factory, when it begins producing in 2018, will have a capacity of 100,000 vehicles annually, some for export but most for U. S. customers. “We have extremely loyal dealers, franchisees that have stayed with us,” said Kerssemakers, acknowledging that the South Carolina plant was, in part, intended to boost their confidence. “We’ve shared our five-year plans with them and as a result of that session, they’re re-energized, they see the potential. Source: fortune.com
