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Volvo mulls expanding electric car production at U.S. plant

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Volvo is considering expanding its electric vehicle production in the United States, according to a report by the Financial Times on November 6, 2023. The company is considering expanding its facility in Charleston, South Carolina, or establishing a second factory within the U.S. This plan is reportedly in response to the U.S. inflation reduction policy, allowing the company to receive tax deductions. Volvo is also planning to strengthen its partnership with Swedish startup Northvolt for battery sourcing.

Volvo has production sites in China, Sweden, and Belgium to minimize tariffs, costs, and political risks, and is searching for another production plant.

In 2017, Volvo began construction of a factory in Ridgeville, South Carolina, with an investment of $1.1 billion. The factory is currently producing the XC90 at a rate of 100,000 units per year.

Many companies are constructing factories in North America in response to the U.S. inflation reduction policy. Northvolt recently announced plans to build a $5 billion battery gigafactory in Quebec for the North American region. Hyundai and Rivian are building factories in Georgia, while BMW is investing $1.7 billion in production and batteries in South Carolina. Volkswagen, which produces the ID.4 in its Tennessee factory, is building a battery factory in Ontario.

However, the recent U.S. presidential election has introduced a variable, as Trump has publicly pledged to scrap electric vehicle policies.

CP-2022-0212@fastviewkorea.com

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