It’s the battle of the billions, as two major automakers are behind back-to-back announcements pledging significant investments in American manufacturing plants.
Volvo has been mid-construction on a plant in Ridgeville, South Carolina where it plans to produce its S60 luxury sedan starting in 2018, but several news agencies are reporting that the company is already looking to expand that site.
According to CNBC, Volvo now plans to expand its investment to a cool billion, and hire an additional 1,900 workers – that’s on top of the 2,000 previously-estimated jobs.
Not to be outdone, Mercedes-Benz says it, too, has a billion dollars to spend, as it plans to build electric SUVs and batteries at its Tuscaloosa, Alabama facility. The endeavor is predicted to create 600 jobs at the existing facility, which already produces Mercedes C-class sedans and GLE and GLS SUVs.
Despite the headwinds facing the American auto industry, the two luxury brands are bullish – probably because they’ve both experienced significant success. In 2016, Volvo hit a record high for U.S. sales and says it’s created “momentum” in this market. As for Mercedes, the automaker outsold all luxury car producers in 2016, overtaking BMW as the top brand.
But here’s the flip side – Volvo has experienced sales decline of more than seven percent in 2017. As for Mercedes, despite its new title of best in the business, it actually suffered a decline in overall sales in 2016. Either way, it would appear that both companies are showing a willingness to roll the dice in a highly competitive segment of a declining automotive market. Only time will tell if it will pay off.