Volvo to build first car plant in U.S.

In a bid to increase sales in America, Volvo Cars is planning to build its first-ever assembly plant in the U.S.

The US$500 million plant will be Volvo’s first car plant in North America.

The Swedish automaker says it has a short list of possible locations but has not yet disclosed them. The company is expected to announce the location in the next few months.

Volvo has been owned by Chinese automaker Geely Holding since 2010. It currently has two plants in Europe and two in China.

“Volvo Cars cannot claim to be a true global car maker without an industrial presence in the U.S.,” said Volvo CEO Hakan Samuelsson said in a statement.

Volvo has sold cars in the U.S. since 1955, but the brand struggled after its sale to Ford Motor Co. in 1999. Geely bought Volvo from Ford for US$1.8 billion.

Now, the automaker is hoping new vehicles—including the upcoming XC90 SUV, which goes on sale this summer—and a bigger manufacturing footprint will help it double its U.S. sales to 100,000 over the next few years.

Sweden’s Volvo Group – the former parent of Volvo Cars – already has a manufacturing presence in the U.S., making trucks at a plant in Dublin, Va., and engines in Hagerstown, Md. The company also has a U.S. headquarters in North Carolina.