Less than a year after announcing plans to localize more machine assembly in the United States, Volvo Construction Equipment is delivering its first American-built excavators and larger wheel loaders to customers.
Volvo CE is significantly expanding its United States footprint, resulting in more than 50 per cent of its North American machine supply being produced at its Shippensburg, Pennsylvania facility.
A total of 11 additional models will be produced in Shippensburg, shortening customer lead times by more than six weeks.
Volvo celebrated the first new machines to roll off the production line on Aug. 18, offering
legislators and business and industry leaders an inside look at the manufacturing transformation.
“What you see today is manufacturing resilience in action: adapting with purpose and speed to increase capacity and build more machines closer to our customers,” said Scott Young, Head of Region North America.
“This achievement advances Volvo CE’s long-term strategy to strengthen stability and flexibility across the North American market while supporting our employees and the regional economy.”
The expansion brings Volvo CE’s North American production portfolio to 30 machine models, including excavators, wheel loaders and compactors. With the most recent investment of $40 million, Volvo CE has invested over $1.4 billion since 2007 to triple its annual output capacity and build workforce skills to support growth and increased digitalization.
Volvo CE acquired the site and its road development division from Ingersoll Rand in 2007 and established its North American headquarters there in 2012. Currently, more than 750 people are employed at the location.
Local supply chain
While Volvo CE expands its North American capabilities, building a stronger local supply chain has been incremental, and is one of the most critical opportunities — and challenges — for Volvo CE and the equipment manufacturing industry.
“Strong, mutually beneficial supplier relationships have been fundamental to how Volvo CE works with its suppliers for decades. But increasingly, success requires a broader ecosystem — where businesses, economic development organizations and communities work together,” said Todd Papple, Head of Purchasing Americas, Volvo CE.
At this week’s event, Volvo CE announced its ambition to grow its business with Pennsylvania-based suppliers by 30 per cent by 2030. Meeting this goal will hinge on partnerships with suppliers, giving them the confidence to invest in their operations to meet manufacturer specifications and volumes while remaining cost competitive.
Growth from within
By building greater flexibility into its operations, Volvo CE is better positioned to navigate geopolitical dynamics and the cyclical nature of the construction equipment industry.
The company increased production capacity through automation, process improvements and more efficient use of existing factory space, enabling growth while maintaining its existing manufacturing space and workforce.
The plant’s combined 436,000 square-foot assembly and fabrication footprint was reengineered creating three flexible production lines capable of building the full range of excavator, wheel loader and compactor models while adding new excavator welding capacity.
To upskill its existing workforce, Volvo CE invested in on-site and off-site training with sister factories in Sweden, Korea and Brazil, equipping employees with new technical skills and expertise. In total, employees completed more than 180 hours of individual training.
“Over the past 11 months, our teams have demonstrated exceptional commitment and execution to expand our production capabilities here in Shippensburg. Along the way, we’ve developed new technical capabilities within our workforce, making us more resilient, and competitive as a manufacturing facility,” said Gustavo Casagrandi, Head of Operations, Volvo CE Shippensburg.
The Shippensburg-based technology team is also evolving from a single-product focus to a more flexible operating model, deploying resources where they are needed most across the product portfolio.
This more integrated approach to manufacturing and engineering enables Volvo CE to better support North American customers while laying the foundation for a more resilient, responsive and sustainable future.
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