Shippensburg key to Volvo Construction’s U.S. expansion with new machine production

Shippensburg is playing a significant role in Volvo Construction Equipment’s expansion of its U.S. footprint.

According to a release, 50% of its North American machine supply being produced at its Shippensburg 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.

“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,” Head of Region North America Scott Young said in a statement. “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. Following a 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. Over 750 people are employed at the location.

Volvo CE has expanded its North American capabilities, and building a stronger local supply chain to support has been incremental.

“Strong, mutually beneficial supplier relationships have been fundamental to how Volvo CE works with its suppliers for decades,” said Volvo CE Head of Purchasing Americas Todd Papple. “But increasingly, success requires a broader ecosystem — where businesses, economic development organizations and communities work together.”

Volvo CE announced its ambition to grow its business with Pennsylvania-based suppliers by 30% by 2030. 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 over $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.

Volvo CE 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.

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. Employees completed more than 180 hours of individual training while gaining invaluable cross-cultural experiences.

In addition, the North American site is pioneering a “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.

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, per the release.

“Over the past 11 months, our teams have demonstrated exceptional commitment and execution to expand our production capabilities here in Shippensburg,” said Volvo CE Shippensburg Head of Operations Gustavo Casagrandi. “Along the way, we’ve developed new technical capabilities within our workforce, making us more resilient, and competitive as a manufacturing facility.”