Scania marks historic milestone with new facility in China

Scania held the inauguration of its industrial hub in Rugao of East China's Jiangsu province on Wednesday. [Photo provided to chinadaily.com.cn]

Scania held the inauguration of its industrial hub in Rugao of East China's Jiangsu province on Wednesday, marking the Swedish truck maker's first fully owned factory in China.

Covering about 800,000 square meters, the new facility entails a 2 billion euros ($2.3 billion) investment, the company's largest overseas investment in 60 years. It is Scania's third industrial production base besides Sweden and Brazil.

The factory will initially employ 3,000 workers and will reach a production of 50,000 trucks, which will nearly double the vehicles produced in its Brazilian plant last year. Throughout 2024, Scania delivered about 100,000 trucks.

Nearly half of the cars to be churned out in the Rugao facility will be exported to the rest of Asia and Oceania.

Christian Levin, president and CEO of Scania, said at the Wednesday event that the Rugao establishment is more than a factory. The new project will be part of China's dynamic innovation landscape and "fuel Scania's own development".

"By producing and innovating locally, we can tap into China's speed and creativity, strengthen our global capabilities, and accelerate the shift towards sustainable transport," he said.

According to the China Automobile Dealers Association, a total of 67,600 heavy-duty trucks were sold in China in August, rising 65.65 percent year-on-year and up by 3.89 percent on a monthly basis. Among them, the number of sold tractor trucks reached 39,700, surged by 83.19 percent from a year earlier and 13.04 percent month-on-month.

The Rugao factory will be a good complement to Scania's existing facilities in China, including a research and development office in Shanghai, a cross-member production base in Wuxi of Jiangsu province, and a side member production base in Qingdao of Shandong province.

The national-level economic and technological development zone where Scania's Rugao facility is based also houses 476 large-scale supporting enterprises. The county-level city of Rugao is 150 kilometers northwest of Shanghai.

It should be noted that the Rugao facility will operate almost entirely on renewable energy sources, including locally produced biogas and certified green electricity.

Scania also unveiled at the Wednesday event the new tractor product range Next Era, which is developed specifically for China's competitive long-haul and volume segment. Defining it as a "new chapter in Scania's commercial offering", the new product will be fully integrated with the Chinese local digital ecosystem.

Deliveries from production in Rugao will begin in late 2025, and Next Era products will be launched in the first half of 2026.