Sweden-based automaker Volvo Group announced plans to open a new large-scale manufacturing site for electric vehicle (EV) battery cells in Europe to meet rising demand for battery-powered heavy-duty vehicles and machines.

"We aim to lead the transition to a decarbonized transport system and have the long-term ambition to offer our customers solutions that are 100% fossil free. There is a strong demand from our customers already today, and by 2030, it is our ambition that at least 35% of the products we sell are electric,” Martin Lundstedt, President and CEO of the Volvo Group, said in a company release Wednesday. “This ramp-up will require large volumes of high-performing batteries, produced using fossil free energy and it is a logical next step for us to include battery production in our future industrial footprint. We aim to do this together with partners and the journey starts now.”

The company selected a location in Mariestad, Sweden for the new facility because of its existing industrial and logistics infrastructure and its proximity to Volvo’s main powertrain production plant.  

Capacity will be scaled up at the new battery cell plant to achieve large scale production by 2030. Battery cells made at the site will be used in commercial EVs, including buses, trucks, construction equipment, and electric drivelines for various applications.

Volvo said it is in the process of obtaining approvals from relevant officials.