Volvo Cars has signed a Memorandum of Understanding with Belgium’s federal government and the regional government of Flanders to bolster the long-term competitiveness of its manufacturing plant in Ghent. The parties will work towards a support package of up to EUR 119 million covering industrial, innovation and ecological measures. Volvo Cars says the deal could also open the door to contract assembly of other brands’ cars at the site.
Volvo Cars has taken a significant step to secure the future of Volvo Car Gent, its long-established manufacturing plant in Belgium. The company has signed a Memorandum of Understanding (MoU) with the Belgian federal government and the regional government of Flanders aimed at strengthening the plant’s long-term competitiveness.
A support package worth up to EUR 119 million
Under the agreement, the parties will work towards support measures that include a package of up to EUR 119 million. According to the manufacturer, this covers industrial, innovation and ecological initiatives, alongside financing programmes and other measures. Volvo Cars says the backing will allow it to pursue strategic investments to further develop Ghent as a key manufacturing site.
Combined with the company’s own efficiency actions, the measures are expected to help secure the future utilisation of the plant and support continued production, the manufacturer states.
The door to contract assembly
Beyond building Volvo cars, the company notes that the arrangement could create opportunities to use Volvo Car Gent for contract assembly of vehicles from other brands. Volvo Cars says this would raise the plant’s utilisation and add to industrial activity in the region — a route several European car makers have explored to keep large plants running at capacity.
What officials say
Flemish Prime Minister Matthias Diependaele framed the deal as the next stage of a decades-long relationship.
“Volvo Cars has been part of Flanders’ industrial fabric for decades. Today, we are building the next chapter of that long-standing partnership. By creating the conditions for new investments, we are securing a strong industrial future for the Ghent site and the wider automotive ecosystem around it. That is how we secure long-term prosperity in Flanders.”
Belgian Prime Minister Bart De Wever said the MoU helps “anchor advanced vehicle manufacturing in Belgium for the long term” and strengthens the country’s position as a location for high-quality industrial employment in Europe.
Volvo Cars President and CEO Håkan Samuelsson welcomed the governments’ engagement. “Volvo Car Gent is a highly capable plant with an experienced team. With these necessary improvements in competitiveness, we are strengthening its future as a car plant in Belgium,” he said.
What it means
Ghent is one of Volvo’s core production hubs, sitting alongside plants in Gothenburg, South Carolina and three sites in China. Securing public support and potentially adding third-party assembly work points to a broader industry push to keep European plants competitive amid the costly transition to electric vehicles. For now, the MoU sets the framework; the concrete investments it enables will determine the plant’s trajectory.
The agreement is a memorandum of understanding, meaning the parties have committed to working towards the measures rather than finalising them. No timeline for the investments was stated.
Source: news.cision.com