Volvo Construction Equipment said it plans to spend $100 million over the next few years to expand its Shippensburg, Pa., manufacturing facility and start production of Volvo wheel loaders, excavators and articulated haulers in North America.
Volvo Construction Equipment, a unit of Torslanda, Sweden-based AB Volvo, will relocate its North American sales headquarters and Volvo Rents offices from Asheville, N.C., to Shippensburg by September 2012.
"It makes sense, when possible, to manufacture products close to where our customers are," said Olof Persson, president and CEO of Volvo Construction Equipment. "The global demand for Volvo construction equipment is rapidly increasing and we need to make investments to meet future demands in the region. Producing Volvo wheel loaders, articulated haulers and excavators in Shippensburg will result in shorter lead times for our customers.
"We will work closely with local suppliers to increase the North American content of our products. This will further reduce our exposure to exchange rate fluctuations, which will already be positively affected by our bringing more production to the U.S.A."
The company plans to build a customer and demonstration center in Shippensburg. In addition, Volvo CE will build a new office building on the campus to house its regional sales headquarters, its Volvo Rents offices and its training center.
All Asheville-based employees will be given the opportunity to relocate to Shippensburg, the company said. The move, which will affect about 220 employees, will be concluded no later than September 2012.
Since the acquisition of the Shippensburg facility in 2007, Volvo Construction Equipment noted it has continuously invested in the existing plant. In June 2010, the company completed a 200,000-square-foot, $30 million expansion of the facility to improve manufacturing flow and increase production space to incorporate the production of Volvo motor graders.