Work is set to start this week on a 600-metre extension linking Fitzherbert Ave with Mosston Rd.
Once completed, it will enable the residential expansion of Springvale and industrial development on Mill Rd.
Identified as a "key growth project" by the Whanganui District Council, the section of road will link the western end of Fitzherbert Ave to Mosston Rd, and will include widening of the planned Mosston/Fitzherbert intersection.
A right-turn bay approaching from the southern end and left-turn slip lane from the northern end of Mosston Rd will also be added.
Whanganui Mayor Hamish McDouall said the work would contribute positively to the local economy.
"This and other infrastructure projects are a major factor in our plans for future-proofing Whanganui, enabling sustainable residential and industrial growth as well as safer transport links," McDouall said.
The project is partially funded under the Whanganui Redeployment fund as part of the shovel-ready framework set by the Ministry of Business Innovation and Employment.
Brent Holmes, the council's senior roading engineer, said the project would create an "important connection" that linked Castlecliff and the Westbourne industrial zone to the city and State Highway 3.
"The direct arterial link will improve freight efficiency across the city and redirect significant volumes of traffic away from narrow residential roads and vulnerable school routes," Holmes said.
The extension was "about 20 years overdue", according to Fox Rd resident Colin Wise, who said the end of Fox Rd had been "poorly neglected" over the past few years.
"There are trucks and trailers coming down [Fox Rd] regularly from Mill Rd and Castlecliff that turn down here to go up the hill to New Plymouth," Wise said.
"The end of Fox Rd is very narrow, and when they closed Buxton Rd all those years ago, all that traffic went down Fox instead.
"We had two lots of traffic on the one road, and at that time they still had a 70km speed limit down the end, which was absolutely crazy."
Wise said he had almost collided with two people on Fox Rd after returning from a deer-hunt with a trailer.
"It was evening and there were two girls walking on the road in dark clothes. At the very last minute I swerved out of the way and I honestly thought I was going to hit them with the trailer. Somehow I missed them.
"I've measured the road at the end here and it's just over five metres wide. They say that you should give a metre and a half to a cyclist, but most trucks are close to 2.5 metres wide so you're on the other damn side of the road already."
Wise said a neighbour, who had lived on Fox Rd for a number of years, had told him that it had begun life as "Fox Lane".
"It was virtually a dead end, but they then opened it up to Mosston Rd. Over the years they've widened Mosston Rd and made it pretty reasonable, but the side roads like Buxton and Fox just can't handle that large amount of traffic."
Whanganui & Partners' interim chief executive Gaelle Deighton said road infrastructure was a key consideration for businesses that were thinking of moving or expanding to Whanganui, particularly in the manufacturing sector.
"The road connection to new housing developments is also important to our economy, making room for further population growth," Deighton said.
"We recently saw our population grow to 48,100 residents, and while this represents sustained growth and a new record population for Whanganui, our rate of growth is below the New Zealand average.
"We expect the rate of our growth to increase in the coming years, and it's great we're preparing our infrastructure."
Dennis Haxton, of Sort It Out Landscaping on nearby Rakau Rd, said the extension would be "really helpful" because there would be a lot more businesses in that area in the future.
"We see a lot of people driving around here who don't know the area," Haxton said.
"They've heard of us, but they've got to try and find us, so anything that will help promote this part of town can only be a good thing.
"Maybe we can even put another one of our flags down there."
Work is expected to be completed before June 30, 2021. Roads will remain open during construction, with speed restrictions in place.
Aside from construction of the road itself, the project also includes new reticulated and utility underground services to future-proof intended residential expansion in Springvale, and a 3m-wide off-road shared pathway.