VOLVO TO PRODUCE EXCAVATORS FOR FIRST TIME IN INDIA
 
Work is underway to build an excavator manufacturing facility in Volvo CE’s road machinery factory at Peenya, Bangalore. The SEK 144 million project will see the current factory expanded to cater to production of excavators, with production earmarked to start in 2011.
 
The new excavator manufacturing facility will ensure Volvo CE India has a steady supply of machines available to customers and improve the chances of converting a prospect into an order. “Currently, we have only one single shipment from Korea delivered to India, which means there is a limited supply to the sub-region and this will all change once we start manufacturing locally” says Jay Singh, VP of Sub-Region India. 
 
 “We are 10% to 15% higher priced than Hitachi and Komatsu machine manufactured locally, so we will always have the price challenge,” says Mr. Jay. “But we expect to see some cost benefit from this initiative in the future.” 
 
The announcement of the excavator production facility is in conjunction with the news, on a corporate level, that Volvo’s Indian joint venture company, VE Commercial Vehicles, will invest SEK 480 million in the production in India of a new global medium-duty engine, which will be introduced in the group’s trucks and buses worldwide over the next few years.