Responding to continued customer demand for electric cars (EVs), Volvo Cars plans to invest €1.2 billion in a third manufacturing plant near Kosice in eastern Slovakia.

The first new Volvo European manufacturing site in almost 60 years, the new state-of-the-art plant will be climate neutral and build only electric cars, supporting Volvo’s goal to be fully electric by 2030 and climate neutral by 2040.

The automaker operates manufacturing facilities in Ghent, Belgium and Torslanda, Sweden.

The fifth car manufacturing facility in the country, the Volvo Kosice plant will benefit from a well-established automotive supply chain.

Construction of the new plant is planned to start in 2023, with equipment and production lines installed during 2024. Series production of next-generation, pure electric Volvo cars is scheduled to start in 2026.

Designed to produce up to 250,000 cars per year, the plant’s location offers good logistical and transport links to the rest of Europe and access to a good supplier base, according to the auto maker. Incentives offered by the Slovak government have also been key in the decision to locate the plant in Kosice.