By Howard S. Abramson, Editorial Director
This story appears in the Nov. 14 print edition of Transport Topics.
KOPING, Sweden — The Volvo Group said it is moving ahead with a plan to shift the assembly of its I-shift automated mechanical transmission from its factory here to the United States and Brazil for trucks that its subsidiaries build in North and South America.
Company officials recently detailed the plans, which were first announced earlier this year, to move assembly operations as part of Volvo’s program to produce more of its products in the regions where they are sold.
The company plans to open an assembly line at its engine factory in Hagerstown, Md., in the third quarter of 2012. The plant will supply transmissions for the trucks Volvo sells in North America.
Volvo said it will spend about $7 million preparing the assembly line in Maryland, which will initially employ about 35 workers.
The transmission line will join Volvo’s engine manufacturing processes in Hagerstown. Volvo, officials said, is now producing about 95% of the engines it installs in the trucks it sells in the United States at the Maryland facility.
During a tour of the large factory in this city in south-central Sweden in late October, officials also said they are preparing an assembly line in Brazil to produce transmissions it sells in South America.
Company officials said that about 80% of the trucks sold in North America by its Volvo Trucks North America subsidiary come with engines produced by Volvo, and 45% of those trucks are being ordered with I-shift transmissions.
Up to now, Volvo has been producing its I-shift transmissions at the factory in Sweden, which was originally purchased in 1927, and employs 1,250 workers. The plant traces its roots back to the mid-19th century, when it was opened as a mechanical workshop.
The I-shift was introduced in North America in 2007 and has been shipped from here to the United States since then.
The transmission can be ordered only when customers purchase a Volvo engine for their new trucks.
Officials said there would be no cut in employment at the Koping factory and that workers would be shifted to other products.
In addition to the I-shift, Koping workers produce marine drives and a separate line for transmissions for dump trucks.
The $7 million the company said it will spend to establish the line in the United States will be used for equipment for the assembly line, tooling and employee training.
