GLOBAL REPORT
In April 2024, Volvo announced that it will build a heavy-duty truck manufacturing plant in Mexico to supplement the Group’s U.S. production. The plant will provide additional capacity to support the growth plans of Volvo Trucks and Mack Trucks in the U.S. and Canadian markets, and support Mack truck sales in Mexico and Latin America. The plant is expected to be operational in 2026.
The new plant will be approximately 1.7 million square feet in size, and will focus on production of heavy-duty conventional vehicles for the Volvo and Mack brands. It will be a complete conventional vehicle assembly facility including cab body-in-white production and paint. At the time of this writing, Volvo has not announced the location of the new production facility.
PSR Analysis: The new plant will primarily focus on the markets in the United States with the intent on supporting sales on the Western third of the country as well as Mexico and the Latin American markets. Basically, this allows Volvo to reduce lead times to key markets, reduce production costs and help off-set potential disruptions to manufacturing like the UAW strike last year that shut Mack’s production down for 39 days.
Volvo will finally join the other large North American OEMs with a production footprint in Mexico. PACCAR, Daimler and Navistar have had production facilities in Mexico for a number of years and it is surprising it took Volvo this long to establish a manufacturing presence in this country. PSR
Chris Fisher is Senior Commercial Vehicle Analyst at Power Systems Research
