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Hagerstown plant adds employees as part of $30 million investment

The $30 million investment will enable Volvo to produce heavy-duty drive axles at the plant in western Maryland instead of buying them from Detroit-based American Axle and Manufacturing Inc., spokesman John Mies said.

The Trucker News Services

10/20/2013

HAGERSTOWN, Md. — Swedish truck- and bus-maker AB Volvo said Friday that it will add up to 140 full-time jobs at its Hagerstown engine-and-transmission plant by 2015 as part of a global efficiency program announced last month.

Mack Trucks also announced that as part of a $30 million investment, the plant that produces all Mack engines and transmissions will begin assembling all Mack heavy-duty drive axles and machining all Mack carrier housings. Mack Trucks, Inc. is part of the Volvo Group.

The $30 million investment will enable Volvo to produce heavy-duty drive axles at the plant in western Maryland instead of buying them from Detroit-based American Axle and Manufacturing Inc., spokesman John Mies said. He said AAM makes the axles in Lancaster, Pa.

“Coming on the heels of the $8 million investment that brought production of the mDRIVE transmission to Hagerstown last year, this decision is another indication of our commitment to excellence in integrated powertrain design and manufacturing,” said John Walsh, Mack vice president, marketing.

In addition to bringing drive axle operations to Hagerstown, the investment will also be used for Mack upgrades to the engine assembly process, and centralization of aftermarket core warehousing operations. Preparation for the Mack axle operations is underway, with full implementation scheduled for 2015.

Volvo's Hagerstown plant, 70 miles west of Baltimore, produces powertrains for Mack, Volvo and Prevost trucks and buses — all Volvo brands. It is Washington County's fourth-largest private employer, with 1,340 full-time workers, according to state and local economic development agencies.

Volvo will get a $4 million conditional loan from the state and a $200,000 conditional loan from the county, according to the Maryland Department of Business and Economic Development. The loans will be forgiven if Volvo makes the investment, retains its existing workforce and adds 140 jobs by Dec. 31, 2015, DBED spokeswoman Karen Hood said.

Volvo said the Hagerstown plant also will become its North American clearinghouse for used vehicle parts.

Volvo, based in Gothenburg, Sweden, acquired the Hagerstown plant when it took over Mack in 2001. It has invested more than $350 million in the facility, which produced more than 45,000 engines and 21,000 transmissions last year.

Volvo said last month that it was starting a three-year restructuring program, mostly of its truck business, to make the company more efficient. The announcement followed six straight quarters of declining profits or losses.

Volvo will release its third quarter 2013 financial results Oct. 25.

The company's North American headquarters are in Greensboro, N.C.

The Trucker staff can be reached to comment on this article at editor@thetrucker.com.

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David Dishneau, Associated Press, contributed to this report

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