UPDATED: Volvo makes South Carolina pick official

Volvo announced Monday that it will build its first U.S. factory in South Carolina, where it plans to build a $500 million facility that could employ 2,000 workers in the first decade and possibly 4,000 thereafter.

The Atlanta Journal-Constitution first reported Friday that a Georgia site had been eliminated from consideration, leaving South Carolina and a site near Charleston as the last known finalist for the factory.

The loss of Volvo to South Carolina was quite a blow to Georgia officials, who'd spent months wooing the Swedish auto giant and crafted what insiders believed to be the largest single incentive package ever offered by the state. It left many high-ranking officials doing some soul-searching after Volvo informed Georgia leaders late Friday it would not build its factory in the Peach State.

“We’re continuing to see significant growth. We have a long list of economic development prospects, and we’re going to concentrate on those,” Gov. Nathan Deal said in an interview Monday. “We’re not going to stop, we’re not going to slow down, and we’re not going to be deterred.”

South Carolina was said to offer an even sweeter bounty of incentives, though details of both packages were not immediately known. Both states also offered giant tracts of land with ready access to ports, highways and rail lines.

The Berkeley County, S.C., site will produce new Volvo vehicles under a new platform for sale in the U.S. and for export. The State newspaper in Columbia, S.C., also reported the site could become a beachhead for Volvo’s parent company, Chinese automaker Zhejiang Geely Holding, to produce and import cars. Volvo was previously was owned by Ford.

Volvo said construction of the factory is slated to start in the fall with the first automobiles scheduled to be assembled in 2018.

“This new global industrial footprint and a complete product renewal forms the foundation for our growth and profitability targets,” Håkan Samuelsson, president and CEO of Volvo Car Corp., said in a news release.

The factory is expected to have initial capacity to build 100,000 vehicles per year, Volvo said.

“This is a landmark moment and truly a great day in South Carolina as we welcome Volvo Cars’ first American manufacturing plant to our state,” S.C. Gov. Nikki Haley said in the release. “Volvo’s presence and commitment to the community will be felt for decades to come. We are proud to have this global leader in car manufacturing join and strengthen South Carolina’s automotive industry.”

Metro Savannah's economy has been on a tear lately, led by manufacturing, logistics and tourism.

Michael Toma, an economist at Armstrong State University in Savannah, said on Monday that “Savannah’s economy is experiencing robust growth.”

“While the Volvo plant certainly would have been a welcome addition to the area’s manufacturing base and the regional economy,” he said, “future growth of the Savannah metro economy is independent of Volvo’s decision and prospects for healthy economic growth remain strong.”

Some were looking for a bright side in the Volvo snub, including the hope that it could free up more resources for the next big pitch. Others saw it as a gut-check moment. Tom Bordeaux, a Savannah city alderman and former state lawmaker, said Volvo would have added “extra horsepower” to southeast Georgia’s economy.

“We have to figure out how we could have been inadequate,” he said, “because I was under the impression that we were offering some remarkable incentives.”