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Volvo moving motor grader activities to Shippensburg

October 01, 2008

SHIPPENSBURG, Pa. -- Volvo Construction Equipment (Volvo CE) will move the majority of its motor grader activities from Goderich, Ontario, Canada, to the company's facility in Shippensburg, the company announced Tuesday.

Volvo CE will incur an estimated restructuring cost of approximately $45 million, which will be recorded in the third quarter of 2008, according to a news release.

The decision to consolidate the industrial operations for road machinery in North America to Shippensburg was taken to improve the competitiveness and profitability of the total road machinery business and will also reduce the company's exposure to exchange rate fluctuations within North America, the release states.

The move, which will affect 500 employees in total, will take place in various phases, concluding no later than 2010, according to Beatrice Cardon, vice president corporate communications for Volvo CE.

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Cardon said it is too early to tell how many, if any, jobs will be coming to Shippensburg.

"That aspect is too early to give because I don't have that information," Cardon said in a phone interview Tuesday afternoon.

"This will be a long process," said Cardon, who said the company is focusing its efforts on helping the workers at the plant at Goderich, a town of about 7,500 people.

The adjustment measures to be adopted for employees represented by the International Association of Machinists and Aerospace Workers will be the subject of discussions to be held with the union, according to the release.

The central parts warehouse in Goderich will be moved to the Volvo parts warehouse in Columbus, Ohio, the release states.

Volvo purchased the Ingersoll Rand plant off U.S. 11 in Shippensburg in 2007. The plant makes road equipment, including asphalt rollers.

As of Tuesday, the Shippensburg Volvo plant employs 774 people, Cardon said.

Volvo Powertrain, a separate division of the company, is in Hagerstown and Tuesday's announcement will have no impact on the Hagerstown operation, Cardon said.

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