A ground breaking ceremony attended by high profile dignitaries on April 18 marked the start of construction on Volvo’s SEK350 million excavator factory, underscoring the company’s commitment to the Russian market.The new plant is being built in Kaluga – 150 km southwest of Moscow – and will be Volvo’s seventh excavator manufacturing facility (of a total of 16 plants globally). Building has begun on the 15 ha plot and, when completed, the final manufacturing area will be 20,660 m². Six models of excavators are planned to be made at the plan ranging from the 20 t EC200 to the 48 t EC480. New Russian dealer Ferronordic Machines has an ambitious investment and expansion program that will see numbers of branches swell to some 100 locations by 2015 (up from today’s 55) and workforce more than double to around 1,000 people in the same timescale. The first machines are due off the assembly lines in 2013, creating 280 new jobs in the process. While these excavator models are mainly used in the construction and quarrying industry, they are also employed in mining applications such as smaller gold operations – both for selective ore mining, as well as host machines for breaker attachments. They have also been delivered to Russian coal operations. This year, Ferronordic delivered a Volvo EC460B excavator to Yakutugol, which will be used for coal loadnig at its Dzhebariki-Khaya mine.

“This is a considerable investment and underscores Volvo’s confidence in – and commitment to – the Russian economy,” commented the company’s President Pat Olney. “Excavators are a key product in this rapidly developing market and customers in Russia have a high regard for the Volvo brand and for the fuel efficiency, reliability and performance of our machines. This investment also demonstrates our strategy of, where possible, manufacturing goods close to where our customers are located.”

“This is the first completely new plant Volvo CE has built for quite a while,” said Carl Slotte, Vice-President of the company’s activities in northern Europe. “Starting with a clean sheet of paper gives us the opportunity to create an advanced manufacturing site that incorporates innovative technologies and designs. It will be built in close compliance with our performance and environmental requirements.” Volvo CE states that it is a leading player in the Russian market today, and plans to double sales in the country by 2015. Excavator manufacturing in Kaluga will play an important role in achieving this goal. The second important success factor will be developing a distribution network.