Volvo Group on Thursday said it plans to build a 1.7 million square feet heavy-duty truck manufacturing plant in Mexico to supplement its U.S.-based production and add capacity to support Volvo Trucks and Mack Trucks growth. The plant, which will be a complete conventional vehicle assembly facility including cab body-in-white production and paint, is expected to be operational in 2026.
With a Mexico plant located in a city the company did not name Thursday, Volvo joins its trucking rivals in cross-border manufacturing: Daimler Truck North America in Saltillo and Santiago; Paccar in Mexicali, Baja California; and Navistar in Nuevo Leon. The announcement comes as Mexico passes China as the top U.S. export partner.
Adding production in Mexico, Volvo said via statement, "will deliver logistical efficiencies for supporting sales to the southwestern/western regions of the U.S., and to Mexico and Latin America. It also provides a mature supply and production ecosystem that will complement the U.S. system and increase the resilience and flexibility of the Group’s North American industrial footprint."
Volvo's Mexico plant will focus on production of heavy-duty conventional vehicles for the Volvo and Mack brands, but the company said the Lehigh Valley (LVO) plant in Pennsylvania and the Volvo New River Valley (NRV) plant in Virginia will continue to be the company’s primary North American heavy truck production sites. Volvo has invested more than $73 million over the last five years in LVO expansion and upgrades, and is currently investing an additional $80 million to prepare for future production. The NRV plant is completing a six-year, $400 million dollar expansion/upgrade to prepare for production of the new Volvo VNL model.
While Volvo has indeed been heaping tons of investment dollars into U.S. production, all has not been easy on the labor front. United Auto Workers (UAW) members late last year kicked off a 39-day work stoppage at Mack Trucks facilities in Pennsylvania, Maryland and Florida.
Mack Trucks' UAW members, roughly 3,900 Mack employees, went on strike Oct. 9, 2023, just more than a week after UAW leadership agreed to a tentative deal that would have avoided the work stoppages – a deal those employees shot down by a 73% margin. The strike ended Nov. 20.
