Since its inception in 1832, Volvo Construction Equipment (Volvo CE) has pursued a singular purpose: to “build a world we want to live in.” This mission is realised through a vast network spanning 180 markets, delivering premium products and services that balance business outcomes with a profound care for both people and the planet. Close to the heart of this global enterprise lies the Arvika plant in Sweden, a site steeped in history and at the forefront of modern manufacturing.
The story of the Arvika site is as rich as Volvo CE’s own. Its origins trace back to 1885, when a visionary blacksmith (Per Andersson) laid the foundation for a local enterprise focused on farming equipment. This humble beginning in the picturesque town of Arvika, which today boasts a population of approximately 15,000, marked the genesis of a manufacturing legacy.
The plant’s trajectory shifted significantly in 1966 when it was acquired by Bolinder-Munktell, which was subsequently integrated into the Volvo Group. This pivotal moment transformed the Arvika facility into a specialised hub for heavy machinery, particularly wheel loaders.
Today, the Arvika plant is not just a production site; it is the core plant for Volvo CE’s wheel loader operations, employing around 1,000 dedicated individuals and serving as a vital support centre for product development and manufacturing methodologies across other global sites, including those in Brazil and China. The Arvika plant also works in close synergy with its sister plant in Braås, which specialises in articulated haulers, sharing similar processes and a common manufacturing ethos.
Looking ahead, Volvo CE is expanding its Swedish footprint with a new excavator factory in Eskilstuna, which will eventually mean all three core product lines (wheel loaders, articulated haulers, and excavators) will be produced in Sweden.
The operational layout of the Arvika plant is a masterclass in integrated manufacturing. Key areas include a state-of-the-art welding shop, a precision machining area, and a modern paint shop, with a new, super-modern facility slated to go live next year.
The site also features a “low volume area” dedicated to the production of specialised equipment, such as the formidable L350 wheel loader, alongside the main assembly lines and a rigorous test track.
A significant recent enhancement is the “off-the-flow” testing and tuning building. This strategic addition allows machines to undergo their final testing and fine-tuning processes without re-entering the main assembly line, dramatically improving workflow and freeing up valuable space. This optimisation is crucial for managing the increasing logistical complexity and the surge in new part numbers driven by the introduction of eMobility (eMob) machines.
The plant operates on a “make-to-order” model, ensuring that every machine produced is pre-sold and meticulously specified to meet individual customer demands. With a capacity to produce approximately three machines per hour over an eight-hour day, the Arvika plant maintains a lean yet robust production schedule.
The entire process, from the arrival of raw steel plates to the finished product, typically spans about eight days, with the fabrication portion alone taking roughly four days. This intricate dance of production is supported by a sophisticated logistics network, with 110 trucks moving in and out of the facility daily, managing steel, cabs, 6-7,000 components per vehicle, and an astonishing 270 variants of tyres to meet diverse customer needs.
Arvika’s product portfolio is segmented across medium, large, and specialised assembly lines. The L90 wheel loader stands out as the biggest volume vehicle produced at the site, underlining its popularity and versatility in the market. While in a significant stride towards sustainable construction, the L90 Electric model is produced on the same assembly line as its conventional counterparts, showcasing Volvo CE’s commitment to integrated electric vehicle manufacturing.
In actual fact, the plant is strategically set up to produce up to 50% electric vehicles, although the current production percentage remains relatively low, indicating immense potential for future growth in this segment.
The transition to e-mobility is supported by robust supply chain partnerships; battery cells for the L90 Electric, for instance, are sourced from Samsung in Korea through a collaborative agreement, while the crucial battery packs are assembled by Volvo itself in its European facilities located in Skövde, Sweden, and Ghent, Belgium. This blend of external partnership and internal expertise ensures a reliable and high-quality supply of electric components.
Quality control at Arvika is not merely a process; it’s a philosophy deeply embedded in the Volvo Production System. This system empowers shop-floor operators with the autonomy to make critical decisions, exemplified by an Andon-like support mechanism. If an operator encounters an issue that threatens to disrupt the takt time (the rate at which products must be completed to meet customer demand), they can activate a “yellow button” to summon immediate support.
This allows for real-time decisions: either resolve the issue on the line to maintain flow or divert the machine to an off-the-flow station for rectification. This proactive approach ensures that quality checks are integrated throughout the process, from welding stations to robot cells and machining centres, preventing defects from propagating downstream.
Daily quality data is automatically disseminated to all personnel each morning, followed by pulse meetings to prioritise actions, whether it’s deploying a special team for a recurring issue or addressing a one-off error.
The consistency and precision demanded by modern construction equipment are largely met through advanced automation. Robotic welding, for example, handles the extensive 60 to 80 metres of weld required for each frame, delivering unparalleled consistency, efficiency, and enabling data-driven predictive maintenance. While welding operations are highly automated, assembly remains largely manual. This reflects a careful balance between investment costs and the longer cycle times (approximately 40 minutes per machine) inherent in heavy equipment manufacturing, a stark contrast to the rapid pace of the automotive industry. Nevertheless, Volvo CE is continuously exploring opportunities for increased automation in assembly to enhance ergonomics, safety, and overall efficiency.
The company has also embraced predictive production and maintenance over the last five years, leveraging connected machines and sensors to anticipate and prevent breakdowns before they occur.
Sustainability and diversity are also high on the Arvika plant’s focuses; they are foundational pillars of its 2030 vision. The site is committed to fostering a more inclusive environment, having successfully doubled its female workforce from 12% to 23%, with an ambitious target of 35%. This commitment extends to making Arvika a climate-efficient site, with ongoing efforts to reduce waste and shorten lead times.
The vision also emphasises empowering every employee to reach their full potential, fostering a culture where teams take ownership of their tasks and collaborate effectively. This people-centric approach cultivates a sense of pride and commitment, which is seen as a cornerstone for delivering high-quality products.
Volvo CE’s procurement strategy further reinforces its sustainability goals, with over 30% of purchased parts sourced from Sweden and more than 90% from within Europe, enhancing flexibility and resilience in its supply chain.
Beyond the factory gates, Volvo CE’s commitment to the circular economy is evident in its approach to end-of-life management. While the Arvika site focuses on manufacturing, the responsibility for managing the second and third lives of machines largely falls to its dealer network.
A prime example is Swecon, Volvo CE’s recently acquired Swedish dealer, which operates a dedicated facility in Eskilstuna. Here, a team of approximately six specialists meticulously dismantles machines, recovering valuable spare parts that are then stocked and resold. This practice not only contributes significantly to planetary health by conserving resources but also provides substantial economic benefits.
By ensuring high residual values for its equipment, Volvo CE enables customers to make more accurate calculations on the long-term cost of ownership and resale value, reinforcing the enduring quality and value of their investment.
In essence, the Volvo CE Arvika plant is a vibrant nexus where a rich historical legacy converges with cutting-edge innovation. From its humble beginnings as a blacksmith’s workshop in 1885 to its current status as a global leader in wheel loader production, Arvika embodies Volvo CE’s unwavering commitment to quality, sustainability, and a people-first approach. The latter extends to huge support of the local town’s pursuits – sports, schools, functions – the list goes on and on.
Through its advanced manufacturing processes, strategic embrace of e-mobility, and dedication to continuous improvement, Arvika is actively shaping the future of the construction industry, one meticulously crafted wheel loader at a time – TACK!
