Volvo CE invests $261 million to strengthen crawler excavator production across three global sites
Expanded production in the U.S., South Korea, and Sweden will strengthen Volvo’s global crawler excavator manufacturing footprint
Volvo Construction Equipment is making a significant investment to expand production worldwide. Three main sites will see approximately $261 million invested to expand crawler excavator production to meet growing contractor demands, mitigate supply chain risks and reduce reliance on long-distance logistics. These sites include Shippensburg, Penn., U.S.; Changwon, South Korea; and a location in Sweden.
In Shippensburg, Volvo CE will not only add crawler excavator production but also expand wheel loader production to include large wheel loaders. Currently, soil and asphalt compactors and mid-size wheel loaders are manufactured at the Shippensburg factory.
Updates will be made to the existing space within the factory to install assembly lines, integrate more automation technologies into the manufacturing process and train employees, with the goal to be production-ready in the first half of 2026.
Investment aims to bolster global machine availability
By expanding production capabilities in key markets, Volvo CE will reduce dependency on any single site and become less reliant on long-distance logistics. Supply chain risks will also be mitigated by expanding domestic supplier bases, allowing Volvo to more nimbly manage any economic or regulatory challenges.
In a rapidly evolving market, strategically enhancing production capacity and flexibility will allow the OEM to meet current and future contractor demands more effectively, according to Melker Jernberg, head of Volvo CE.
Jernberg adds that fostering collaboration with local suppliers and contractors will better position the company for sustained growth and innovation without compromising the high standards that Volvo CE equipment is known for.
Shippensburg employees celebrate announcement
Volvo CE acquired the Shippensburg site in 2007 from Ingersoll Rand and relocated its regional headquarters there in 2012. On top of recent investments, Volvo CE will invest approximately $40 million locally over the next five years. The expanded production capabilies are a win for central Pennsylvania, as it shows the company's continued commitment to the local community and its economic vitality.
"Bringing excavator production to North America and growing the range of wheel loader models built here has always been part of our long-term industrial plan, so it's exciting to finally share this news with our employees, dealers and customers," said Scott Young, head of Region North America. "This increase in production capacity means that over 50 percent of our North American machine supply can be built here in Shippensburg, resulting in shorter lead times while also creating opportunities for supplier growth."
The investment aims to strengthen and expand Volvo CE's global crawler excavator footprint
In a rapidly evolving market, this strategic initiative will significantly enhance capacity and flexibility, allowing Volvo CE to meet current and future contractors demands effectively. By adding production capacity near key markets, Volvo CE will improve operational efficiency and resilience, ensuring shorter delivery times and tailored solutions for regional needs.
This approach mitigates supply chain risks through localized production, reducing reliance on long-distance logistics, and managing economic and regulatory challenges. Additionally, it aims to lower carbon emissions by minimizing transportation distances. By fostering collaboration with local suppliers and contractors, Volvo CE is positioned for sustained growth and innovation, reinforcing its market presence, utilizing existing and new competences and navigating complexities more effectively.
The Changwon factory remains a key site in the global industrial network
The Changwon site remains an important factory in the company's global industrial network holding key competences for manufacturing, product development, and purchasing. The investment in Changwon is aimed at securing global volumes and capabilities while at the same time leveraging supply chain capabilities to enhance efficiency, reduce costs, and improve responsiveness to market demands.
