Volvo Construction Equipment will add production capacity to its facilities in Shippensburg, Pennsylvania, as part of a global investment of $261 million.
Shippensburg currently produces compactors and mid-size wheel loaders, and the expansion will include production of large wheel loaders as well as the addition of crawler excavators. Factory updates will include installation of assembly lines, integration of more automation technologies into the manufacturing process, and employee training. The company plans to begin production in the first half of 2026.
“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,” said Scott Young, head of Region North America. “This increase in production capacity means that over 50% 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 also covers expansion of excavator production in Changwon, South Korea, and a location in Sweden. The expanded excavator production will “meet growing customer demands, mitigate supply chain risks, and reduce reliance on long-distance logistics,” according to the company.
“We must respond to growing demand, and we’re excited to expand our facilities to serve our customers better,” said Melker Jernberg, head of Volvo CE, in a statement. “This investment underscores our commitment to quality and innovation, allowing us to deliver even greater value.”
The global move will enable the company to 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 the OEM “to more nimbly manage any economic or regulatory challenges,” according to the company. Fostering collaboration with local suppliers and customers will better position the company for sustained growth and innovation without compromising the high standards that Volvo CE equipment is known for, according to Jernberg.
