The Volvo Group will invest SEK 783 million (about U.S. $120 million) in a new facility to produce cabs at its plant in Kaluga, Russia, Volvo CEO Olof Persson said this week. The facility, which is expected to become operational in 2014, will manufacture cabs for the Volvo and Renault Truck brands with a total annual capacity of 15,000 cabs.
Volvo broke ground on the facility in April.
“This investment is a natural step in efforts to further consolidate our strong position in the premium heavy trucks segment in Russia,” said Persson. “We have strong confidence in the Russian market and believe that there is immense potential for further growth in the years ahead.”
The Kaluga plant, about 200 kilometers south of Moscow, was inaugurated in 2009 and currently supplies Russia and surrounding countries with trucks, with capacity for about 15,000 trucks a year. In 2012, the total market for Western premium heavy trucks is expected to amount to 28,000 vehicles, a two-fold increase compared to 2010.