HAGERSTOWN, Md. – Volvo Powertrain’s Hagerstown, Md. engine plant has received a US$150 million makeover in preparation for 2007 engine production.
The plant will be home to production of the Mack MP7, MP8 and MP10 as well as the Volvo D11, D13 and D16 powerplants. Currently, about 160 Mack and 100 Volvo engines are built there each day, along with 75 Mack gearboxes. About 1,772 people work at the plant, however Mack and Volvo officials admit that number will decrease as order intakes dwindle and fleets and owner/operators delay purchasing the costly ’07 engines. More than 270 workers will take advantage of an early retirement program at the end of the year, but the company has asked that they remain on-board for now to keep up with record breaking orders resulting from a significant pre-buy that is now in full swing.
When Truck West visited the plant in late April, Volvo and Mack officials said order intakes were extremely high.
Other manufacturers enjoyed similar success in March, making it the strongest retail month in the history of the industry. However, Mack’s Kevin Flaherty added order intakes were expected to plummet beginning in April, and could hit as low as 800 units per month as the company runs out of 2006 engines.
“We’re sold out,” Flaherty told a gathering of trade press editors, adding the industry as a whole will be unable to accept any more orders for 2006 engines beyond the end of April.
For its part, Volvo is reporting a similar experience. Peter Karlsten, president and CEO of Volvo Trucks North America, said Volvo is in the same boat.
“With this high order intake, we are virtually sold out for the year,” Karlsten said in late April. “The order intake will start to decline. We’ll see the first reductions in April and it will continue until customers begin to order 2007 trucks.”
While the manufacturers may be bracing for a slowdown as 2007 approaches, it’s full steam ahead right now at Volvo Powertrain’s Hagerstown engine plant. While the company admitted it explored several alternatives to producing the 2007 Volvo engines in Hagerstown (including moving production to Mexico), it was decided that the company had a good thing going in Maryland where it had an experienced, dedicated workforce already in place.
“The best solution was to stay right here and invest in the facility,” said Sten-Ake Aronsson, senior vice-president of Volvo Powertrain North America. “The most valuable asset here is the personnel, both on the engineering and shop floor sides.”
So having scrapped any plans to “build on a green field,” Volvo Powertrain set out to inject $150 million into the plant to boost capacity, increase efficiency and also to make it a more enjoyable work environment for employees.
After 45 years of operation at the Hagerstown plant, Aronsson admitted it was “time for some new wallpaper.”
Highlighting the improvements was construction of a new engine development laboratory capable of measuring even the most minute emissions.
The new lab, which ate up $40 million of the investment, features eight engine test cells. The new lab can be used to test new types of fuel, such as alcohol, which may be explored as future emissions-reducing solutions.
The laboratory, which will be fully operational by mid-August, is also capable of testing hybrid vehicles.
Inside the 1,255,000 sq.-ft. assembly plant, upgrades were made to improve productivity. While increased automation is a reality today (robots were tackling some of the more mundane operations), the plant’s human workers were not forgotten.
A large cafeteria features numerous skylights to allow sunlight into the plant. The lunchroom – formerly a dingey machining room – is designed to promote interaction between employees.
“The idea is to have a hub, where people can communicate in a good way,” Aronsson pointed out during a plant tour.
A new assembly line provides workers with improved lighting and ventilation, as well as hardwood flooring over-top a thick, rubber underlay.
“The floor gives a little, but it doesn’t fight you every step of the way,” explained Roger Johnston, vice-president and general manager, Volvo Powertrain North America.
The walls surrounding the new assembly facility are lined with sound-dampening material that significantly reduces the noise typical of any factory. It can certainly be appreciated when stepping inside from the adjacent assembly line which has yet to receive the upgrades.
By consolidating Mack and Volvo engine production at the Hagerstown assembly plant, Volvo has been able to significantly reduce the eight week lead time required when the powerplants were built in Sweden. Still, the Hagerstown and Skovde, Sweden manufacturing plants keep a close eye on each other, sharing secrets and establishing and adopting each others’ best practices, Johnston pointed out.