25 Apr 2024 -
 EV

Slovakia greenlights €267m aid for Volvo EV plant

Slovakia has secured EU approval for a €267 million investment to support Volvo Cars’ new electric vehicle plant in the country. The Commission’s decision underscores the EU’s focus on fostering both regional economic development and the transition to a net-zero emissions economy.

Volvo’s plant will be located near the city of Košice in Eastern Slovakia, a region facing economic challenges but designated for special support under EU policy. The facility will manufacture 250,000 EVs annually and create thousands of jobs in a major boost to the local economy.

Slovakia will provide direct grants for the project, demonstrating the government’s proactive approach to attracting investment aligned with EU goals. Volvo is investing an additional €1.2 billion, indicating the strategic importance of the new plant within its European production network.

The Commission carefully assessed the state-aid package to ensure compliance with EU rules. It determined that the aid is necessary to incentivise the investment in this specific region and is unlikely to significantly distort competition within the bloc. This balanced approach reflects the EU’s wider aims of encouraging economic growth while maintaining fair market conditions.

Overall, the approval highlights the potential synergies between supporting disadvantaged regions and the green energy transition. Slovakia’s successful bid reinforces the attractiveness of Central and Eastern Europe for automotive investments, particularly in the rapidly expanding EV sector.

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