Volvo Construction Equipment (Volvo CE) has commenced construction of a new excavator factory in Eskilstuna, Sweden.
The groundbreaking ceremony was attended by Swedish Prime Minister Ulf Kristersson and Deputy Prime Minister Ebba Busch, who operated electric 23t excavators for a symbolic first dig.
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The facility, scheduled for completion in 2028, represents a Skr700m ($73m) investment aimed at strengthening the company’s global competitiveness and supporting the local economy in the Mälardalen region.
Kristersson said: “I’m incredibly pleased to be here today and show how this proud heritage is being carried forward. I strongly believe in the close dialogue between business and politics that we have in Sweden.”
According to Volvo CE, the decision to build the factory in Eskilstuna comes as the company continues to invest in its Swedish operations while other industrial manufacturers relocate production abroad. The project is expected to create jobs and contribute to regional growth.
The new plant will manufacture crawler excavators for both electric and combustion engines, with an annual production capacity of up to 3,500 machines.
The facility will cover approximately 30,000m² and will focus on excavators ranging from 14t to 50t.
Volvo CE President Melker Jernberg said: “Sweden has been a natural part of Volvo CE’s industrial journey for nearly two centuries, and we are proud to continue making major investments that strengthen both Sweden and Europe on the global stage.
“By investing in new excavator production in Eskilstuna, we are strengthening our global competitiveness while creating jobs, developing technology and reinforcing our strong industrial base in Sweden.”
Eskilstuna already serves as the location for Volvo CE’s global headquarters, its largest centre for research and development, the European sales organisation and a component factory.
The new plant will allow the company to produce all its principal machines in Sweden, including articulated haulers in Braås, excavators in Eskilstuna, wheel loaders in Arvika and cabs in Hallsberg.
Since 2010, the European market for large excavators has increased by 50%, with demand expected to continue rising, according to company figures.
Volvo CE stated that local production in Eskilstuna should reduce delivery times, minimise supply chain disruption and lower transport emissions.
The company has invested more than Skr9bn ($935m) in its industrial capacity and retail network in Europe in recent years, with about 40% of its total production hours based in Sweden.
In March, Volvo CE revealed plans to discontinue its Rokbak articulated hauler division, citing unsustainable profitability and a change in long-term strategy.
