Volvo has become the latest automobile major to place a bet on South Carolina by picking Berkeley County to locate a $500 million assembly plant, having close access to critical shipping ports.

The main aim of the Chinese-owned auto maker is to nearly double the global sales by 2020. Since taking control of Volvo in 2012, Chief Executive Håkan Samuelsson has repeatedly defended the auto maker's decision to continue selling cars in the US regardless of sales decline and red ink in the region.

Earlier this year, Daimler AG's Mercedes-Benz made an announcement of $500 million van factory near Charleston.

According to the SC Automotive Council, BMW AG has been operating a plant in Spartanburg, which buoys a South Carolina automotive industry, employing 46,000 people.

Volvo's decision has come up as an automotive win to the US south in an era when a lot of global auto makers are preferring to invest in Mexico due to its lower wage costs and an arsenal of trade deals.

In April, Mexico's vehicle production has hit a record up 14% amid strong North American demand and a stream of new capacity.

Berkeley County has beaten out many candidate sites from other states. For example, last week officials in Georgia were working until late to persuade Volvo to locate there.

Volvo has refused to immediately outline tax breaks and other incentives that were offered by officials in South Carolina.

In an interview, Mr. Samuelsson said that the new factory will help smooth currency exposure and reduce other costs such as the ones related to logistics.

Scheduled to break ground by the end of this year with a 2018 completion target, Volvo is going to import all cars for sale in the US from Europe and China until the completion of the plant.