Volvo Construction Equipment Rolls Out First U.S.-Built Excavators and Large Loaders

Government officials and industry leaders tour Pennsylvania factory to see how Volvo Construction Equipment (Volvo CE) is delivering on its commitment to bring products closer to customers and strengthen its North American footprint.

SHIPPENSBURG, Pa.--(BUSINESS WIRE)--Volvo CE is significantly expanding its U.S. footprint, resulting in more than 50% of its North American machine supply being produced at its Shippensburg, Pennsylvania facility. Less than a year after announcing plans to localize more machine assembly, the company is delivering its first American-built excavators and larger wheel loaders to customers. A total of 11 additional models will be produced in Shippensburg, shortening customer lead times by more than six weeks.

The company marked the milestone with an event attended by legislators and business and industry leaders on Aug. 19. They got an inside look at the manufacturing transformation and Volvo CE’s ongoing efforts to develop a localized supplier base.

“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. 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,” said Scott Young, Head of Region North America.

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, over 750 people are employed at the location.

“Volvo CE has taken seriously its commitment to investing in and revitalizing American manufacturing. This facility right here in Shippensburg is not only building world-class construction equipment; it is creating opportunities for families and workers throughout our community. Pennsylvania has always been a strong contributor to our nation’s manufacturing strategy, and this expansion is proof that we will continue to be a leader in its future,” said Congressman John Joyce, M.D.

Thinking Globally, Executing Locally

While Volvo CE has made major strides to expand its North American capabilities, building a stronger local supply chain to support 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% by 2030. Meeting this goal will hinge on strong partnerships with suppliers, giving them the confidence to invest in their operations to meet manufacturer specifications and volumes while remaining cost competitive.

To support this initiative, Volvo CE partnered with the Franklin County Area Development Corporation to support a global excavator counterweight supplier's decision to land a regional operation. The supplier is investing more than $1.5 million in a local facility, creating jobs to complete and deliver counterweights directly to the Shippensburg plant on a just-in-time basis.

This type of private-public collaboration is essential to creating an environment where suppliers can confidently invest alongside manufacturers.

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 ft² 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 extensive 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 while gaining invaluable cross-cultural experiences.

The North American site is also pioneering a new “utility specialist” approach for production of large wheel loaders, which require 30% more parts and complexity to build on the same line. Employees were cross trained in multiple zones to provide additional support at stations requiring extra labor, helping maintain a steady workflow. Innovation around the way we work and insights from the pilot can be applied to the excavator line and shared across Volvo CE sites worldwide.

“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.

Volvo Construction Equipment (Volvo CE) is a global leader in construction solutions, delivering premium products and services that combine power and performance with a more sustainable way of working. We are a company driven by people and together we have a purpose: To build the world we want to live in. Founded in 1832 and with a distribution network across every major market, our many dedicated experts around the world are fulfilling our shared purpose through a focus on sustainability, electromobility and services. As well as our expanding range of electric machines and charging solutions, Volvo CE provides industry-leading haulers, loaders, excavators and much more, all built to suit the demands of our customers’ varied construction and infrastructure needs. Volvo CE benefits from being connected to the Volvo Group, which also offers trucks, buses, power solutions for marine and industrial applications, financing and services that increase our customers’ uptime and productivity. Through its holistic perspective, Volvo Group is committed to shaping the future landscape of sustainable transport and infrastructure solutions. For further company information and to explore our values further please visit www.volvoce.com.