Volvo Development Tools will spend simply over $260m increasing its capability to make crawler excavators in South Korea, Sweden and the US to make the factories extra self-sufficient and fewer liable to financial shocks like tariff hikes.
A last resolution relating to the situation, scope and timing of the expansions will probably be made later this yr, however one transfer has been finalised: the addition of an excavator meeting line to Volvo’s manufacturing facility in Shippensburg, Pennsylvania.
Volvo mentioned its plan would “improve capability and suppleness … and enhance operational effectivity and resilience, guaranteeing shorter supply instances and tailor-made options for regional wants”.
The crawler excavator market was valued at $47bn final yr, and is anticipated to succeed in $68bn by 2034, an annual progress fee of 4%. Volvo is without doubt one of the foremost gamers available in the market, alongside Caterpillar, Komatsu and Hitachi, amongst others.
The transfer to extra native manufacturing, with better use of native suppliers, eases logistics and reduces what the corporate referred to as “financial and regulatory challenges”.
Specifically, tools makers with provide chains that require imports into the US are susceptible to the US’ unpredictable modifications in tariff coverage.
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