Volvo CE brings crawler excavator assembly home to Eskilstuna

Volvo Construction Equipment will build a new crawler excavator assembly plant in Eskilstuna, Sweden, the town where the company’s story began almost two centuries ago.

The 30,000 square meter factory will serve European markets and is designed for an annual output of up to 3,500 machines on a mixed line that can build both battery-electric and diesel models in the 14 to 50 tonne classes. Volvo CE is investing about 63 million EUR in the project, which forms part of a wider 225 milion EUR global excavator investment package covering Korea, Sweden and the United States.

By assembling excavators inside Europe rather than relying mainly on imports from Asia, the company expects to increase capacity and flexibility for European customers while cutting lead times, long-distance logistics and associated emissions.

Groundworks are planned to start in the first half of 2026, with production beginning within two years of project launch, subject to environmental and building permits.

A new plant in the town where Volvo CE was born

The choice of Eskilstuna is not just about available land and logistics. It is where the construction equipment business that later became Volvo CE started in 1832.

That year, engineer Johan Theofron Munktell was commissioned by the city of Eskilstuna to establish an engineering workshop to develop the local mechanical industry.  From that shop grew a company that built Sweden’s first steam locomotive in the 1850s, along with printing presses, agricultural machines and early road rollers.

Eskilstuna itself was already an industrial town. From the 18th and 19th centuries it became one of Sweden’s main metalworking and steel centers, earning the nickname “Stålstaden” or “City of Steel” and often compared to Sheffield.

Today, Volvo CE’s global headquarters, a major factory, R&D operations and the large Customer Center are all located in Eskilstuna, with around 2,500 employees on site.  The Munktell Museum, owned and run by Volvo CE, sits a short walk away and showcases nearly 190 years of machines, from early steam equipment to modern construction machinery.

Bringing crawler excavator assembly into this cluster turns Eskilstuna into a full campus: history, demonstration grounds, engineering, headquarters and now a dedicated excavator plant on the same home turf.

What the new Eskilstuna excavator plant will do

According to Volvo CE, the new crawler excavator assembly plant will:

• Cover around 30,000 m² in Eskilstuna.
• Produce up to 3,500 excavators per year.
• Run a mixed line, building both electric and internal combustion machines.
• Focus on medium and large crawler excavators from 14 to 50 tonnes.
• Serve primarily European markets.

The project is part of a broader 2.5 billion SEK investment program to upgrade excavator production in South Korea, Sweden and the United States.

By adding excavator assembly next to its headquarters, tech center and Customer Center, Volvo CE can tie product development, demonstration and production more tightly together. Eskilstuna already has a new test and demo area dedicated to electric and autonomous solutions, including charging infrastructure and 5G connectivity, which will be highly relevant for future electric crawler excavators such as the EC230 Electric. 

Why this matters for the European excavator market

Machines for European customers will not have to cross oceans to reach the continent, which should help Volvo CE respond faster to demand swings or custom specifications.
Supply-chain resilience inside Europe

With more production located within the region, the company reduces its exposure to potential disruption on long-haul routes and ports, an issue that has hit many OEMs since 2020.

Acceleration of electric excavators

Building electric and diesel models on the same line makes it easier to scale electric volumes as customers switch from conventional machines to models like the EC230 Electric in the 20–25 tonne class.
Stronger local story for a historic brand

For a company that markets itself on Scandinavian engineering and safety, being able to say that key excavator models are built in the same town where Munktell set up his workshop in 1832 is a powerful narrative.

Timeline and next steps

The project is still conditional on regulatory approvals:

Environmental and building permits must be granted by Swedish authorities.
Groundworks are scheduled to begin in the first half of 2026.
Production is planned to start within two years of project initiation.

If the schedule holds, the first series-built crawler excavators from Eskilstuna could reach European job sites in the late 2020s, almost two centuries after Johan Theofron Munktell opened his first workshop in the same town.