KOSICE, Slovakia—Volvo is spending $1.24 billion build a new assembly plant here that will be exclusively dedicated to making electric vehicles.

Construction is expected to begin next year. Equipment and assembly lines will be installed in 2024, and production is expected to start in 2026. The plant will be capable of building up to 250,000 electric cars per year. The plant will create thousands of new jobs in the region.

“We have a clear focus on becoming a pure electric mobility brand by 2030, which is in line with our purpose,” says Jim Rowan, CEO of Volvo Cars. “Expansion in Europe, our largest sales region, is crucial to our shift to electrification and continued growth.”

In line with the company’s goal to have climate-neutral manufacturing by 2025, the new plant will use only climate-neutral energy.