Volvo CE to open excavator plant in Russia

SEK350 million investment in new production facility signals continuing commitment to Russian market

VOLVO Construction Equipment are to invest SEK350 million in the construction of a new excavator plant in Kaluga, Russia, highlighting the company’s continued commitment to the Russian market.

As part of their ongoing expansion in developing markets, Volvo CE will build the new 20,660 square metre facility on 15ha of land that the company acquired in 2007.

The Kaluga plant will initially manufacture five models of Volvo excavator – the EC210, EC240, EC290, EC360 and EC460 – with production planned to begin in the first quarter of 2013.

According to Pat Olney, president and chief executive officer of Volvo CE, the new plant will meet increasing demand in the country.

‘The new investment in Russia is part of our strategy to build machines where they are sold and thanks to a strong partnership with our Russian dealer, Ferronordic, our customer base is growing significantly in the country,’ he said.

‘We have seen a strong commitment from Ferronordic, who are investing a substantial amount of money to support their further expansion in the Russian market.’

The construction equipment market in Russia is estimated to reach approximately 25,000 units in 2011.

Meanwhile, in a separate development, Volvo CE have strengthened their presence in the rapidly developing market of Indonesia with the appointment of PT Indotruck Utama (ITU) as their second authorized dealer in the region.

ITU will work alongside PT Intraco Penta Tbk (INTA), who have been Volvo CE’s sole Indonesian dealer for the past 29 years.

Derrick Sim, president director of PT Volvo Indonesia, said: “With the phenomenal market growth in Indonesia right now, we believe the time is right to expand our services across the country.’

The two dealers will divide the market, with ITU handling Sumatra, Java, Nusa Tenggara and Papua, and INTA covering Kalimantan, Sulawesi and Maluku.