Report: Volvo To Establish US Production Facility

2016 Volvo XC90 (Credit: Volvo)

The Financial Times recently ran a report that asserts Volvo will be putting a manufacturing facility somewhere in the United States, following the trend of other foreign automakers that have established or strengthened manufacturing installations in the country. According to the publication’s unnamed sources, which are said to have special knowledge of the process, potential sites are located in the states of Kentucky, South Carolina, and North Carolina. Volvo is assessing what incentives it could receive for locating the manufacturing facility in various locales, plus the pool of local workers it would be able to draw from.

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After being purchased by Geely Automotive, Volvo has expanded its manufacturing to China, which is where Geely is based. Volvo has stated that China is its most important market in the world, but the US is number two. In the past, the U.S. was the top market for Volvo, but recently the brand has suffered a number of setbacks as other automakers like Kia and Hyundai have surged.

Apparently the effort to make vehicles in America is part of a plan to expand sales in the U.S. once more. For 2014, only 12 percent of Volvo’s worldwide sales came from the United States. When compared to the numbers from 2013, last year marked a 7.9 percent decline. In other words, to take the U.S. market back Volvo has its work cut out for it.

There is already a preliminary sales goal for the U.S. market, which Volvo announced is 100,000 units annually. For 2014, the automaker racked up 56,366 units, meaning it aims to essentially double sales in the short run. Constructing cars in various locations around the globe helps protect against the volatility of currencies and makes it far easier to supply vehicles for foreign markets.

Already Volvo is shaking things up with the upcoming 2016 XC90 crossover, which promises a much more luxurious and stylish vehicle that will help Americans see the brand in a new light. It will also be bringing the S60 Inscription, which is a long-wheelbase version of the sedan, over from China.