By David Shepardson and Ludwig Burger
WASHINGTON/FRANKFURT (Reuters) - Volkswagen (ETR:VOWG_p)'s off-road brand Scout Motors said on Friday it would build a $2 billion manufacturing plant near Columbia, South Carolina, for trucks and SUVs.
The investment could potentially create 4,000 or more permanent jobs and more than 200,000 Scout vehicles could be produced annually at the facility.
In May, VW said it would reintroduce the Scout off-road brand in the United States, offering new electric pickup and sport-utility vehicles (SUVs).
Groundbreaking is planned for mid-2023 and production is projected to begin by the end of 2026. Scout, an independent U.S. company owned by Volkswagen Group, is currently evaluating the potential for outside investment.
"We’re reimagining Scout’s original ingenuity and electrifying its future," said Scout Chief Executive Scott Keogh.
Volkswagen has moved away from cars in the United States as it adds more electric models. SUVs now account for about 80% of the U.S. sales of the group’s VW and Audi brands. VW last sold a pickup in the United States in the early 1980s.
Scout and Travelall vehicles made by International Harvester were forerunners in both function and style of the popular SUVs from Detroit's Big Three automakers such as the Ford Bronco and General Motors (NYSE:GM) Chevrolet Suburban.
Harvester stopped building the Scout and Travelall in 1980 after the oil price shocks of the mid-1970s as it went through a restructuring.
But the Scout "look" lives on in vehicles such as Ford’s current Bronco and electric vehicle startup Rivian‘s R1 pickup and SUV line.
Volkswagen first disclosed it was considering using the Scout name late in 2021. The automaker’s Traton SE business acquired U.S. truck maker Navistar (NYSE:NAV) in 2020, which owns the name.
The news is the latest major auto announcement for South Carolina, which is home to BMW's U.S. operations and its largest plant by volume. The state also has over 500 automotive-related companies and 75,000 automotive industry employees.
BMW said in October it would invest $1.7 billion to build electric vehicles in South Carolina. The German automaker made a new $1 billion investment in its Spartanburg plant to prepare for EV production and is spending $700 million on a new high-voltage battery assembly facility in nearby Woodruff, South Carolina.