Electrolux, one of the largest manufacturers of home appliances, said that it would invest $250 million to modernize and expand one of its factories in the United States. For Electrolux, the improvements fall under its strategy to increase capital expenditures for product development and automation in its manufacturing plants.
The factory being updated to expand production of a new line of cooking appliances is located in Springfield, Tennessee. Electrolux said that the construction will begin in late 2018 and last around two years. The announcement came after the company revealed a separate $250 million project to consolidate its American freezer production in Andersen, South Carolina.
With both factories being updated, Electrolux plans to halt production after next year at a factory located in St. Cloud, Minnesota. The restructuring is part of the company’s plan to increase its capital expenditure to around $744 million by 2018. The $500 million investment in Springfield and Anderson are part of this plan.
The changes come as the global market for household appliances continues to grow. The market is expected to reach $588.8 million in 2020, up from $428.17 billion in 2013, according to research firm Statistica. From washing machines to toasters, these products are packed with analog components and, increasingly, simple computers and wireless chips.