My dealer rep called this week and led with "so when are you going to CONEXPO?" Brother, I was not at CONEXPO. I was on a job in the mud like a normal person.
VOLVO CE SHIPPENSBURG GOES LIVE
The Plant Is Producing. This Is Not a Future Commitment Anymore.
Volvo CE confirmed at CONEXPO that its Shippensburg, Pennsylvania facility is producing crawler excavators and four large wheel loader models in early 2026. This is the announcement coming off the drawing board and onto the floor. The Shippensburg plant, which previously built only soil and asphalt compactors and mid-size wheel loaders, is now assembling the EC140 through EC500 series excavators. Four additional large wheel loader models have been added to the line as well. Once fully ramped, Volvo says over 50 percent of its North American machine supply will be built at Shippensburg. The $261 million global investment split across three sites, Shippensburg in Pennsylvania, Changwon in South Korea, and a plant in Sweden, was announced in June 2025, but the production window is now.
Why This Is a Tariff Play More Than a Supply Chain Story
Volvo CE said in plain language when announcing the expansion that the goal was to mitigate supply chain risks and reduce reliance on long-distance logistics. Read that in the current environment: avoid tariff exposure. Section 232 steel and aluminum tariffs are baked into every imported machine. Section 122's 15 percent surcharge is running through July 24. USTR launched Section 301 investigations on March 11 targeting machinery and transportation equipment from 16 countries including South Korea. Volvo CE sourced excavators from Korea and Sweden before this. Pennsylvania-built machines exit that exposure. The company also committed to expanding its domestic supplier base, which means the tariff insulation extends down the component chain over time.
What You Need to Ask Your Volvo Dealer Right Now
Dealers should know which plant a specific order is coming from, and buyers should be asking. A Shippensburg-built EC295 and a Changwon-built EC295 carry different landed cost structures under the current tariff regime. Lead times will also differ. The other implication is competitive: Cat and Deere have had U.S. production advantages in several excavator classes for years. Volvo just narrowed that gap. Dealers for competitive brands should expect Volvo reps to use domestic production as a selling point on every bid.
This is a meaningful structural move, not a press release. Volvo CE is the first non-U.S. headquartered OEM to bring mid-to-large excavator production to North American soil at this scale. Pay attention to what it does to lead times and pricing over the next two quarters.
QUICK HITS
Big: The Construction Recovery Is Showing Up in the Numbers
John Deere's Q1 fiscal 2026 results, released February 19, showed Construction and Forestry net sales up 34 percent year-over-year to $2.67 billion, with operating profit more than doubling from $65 million to $137 million on higher shipment volumes. More forward-looking: the construction order bank rose over 50 percent in the past quarter, reaching its highest point since May 2024. CEO John May called 2026 the bottom of the current cycle. Separately, Komatsu's nine-month results through December 31, 2025 showed operating income down 10.1 percent, with the company under pressure from tariffs and yen strength. Komatsu has signaled it is considering U.S. price increases in response to a projected annual negative tariff impact of around 140 billion yen on its construction and mining equipment business. Two different signals here: Deere's construction segment is moving while Komatsu is absorbing cost and deciding whether to pass it on. If Komatsu raises prices, it hands margin back to Cat and Deere on competitively bid projects.
Small: The Doosan Bobcat and Wacker Neuson Deal Is Dead
Doosan dropped its bid for Wacker Neuson in late January 2026, pivoting instead toward acquiring SK Siltron, a South Korean semiconductor wafer maker. The talks had been in "advanced discussions" since at least November 2025, with Doosan Bobcat contemplating acquiring approximately 63 percent of Wacker Neuson's shares in an all-cash offer valued at over 2 billion euros. The deal is off. Wacker Neuson, which manufactures compactors, mini excavators, wheel loaders, telehandlers and hand-held vibratory equipment, is back to independent status and an acquisition target again. For Bobcat dealers, the competitive picture in the compact segment stays as-is for now. For Wacker Neuson dealers, expect a period of strategic uncertainty while the Munich-based company figures out its next move.
Ag: Deere Called the Cycle Bottom and Stuck to It
Deere's Q1 FY2026 results showed production and precision agriculture operating profit down 59 percent, but management held guidance for full-year net income of $4.5 to $5.0 billion and raised the midpoint on full-year revenue. The large ag market in the U.S. and Canada is expected to decline 15 to 20 percent in 2026 by the company's own forecast, but late-model used tractor inventory is down more than 40 percent from its March 2025 peak, which management treats as a prerequisite for renewed replacement demand. For dealers carrying both ag and construction lines, the construction side of the Deere book is the active side this year. Allocate service capacity accordingly.
THE LUNCH ROOM
SIGN-OFF
Heard anything this week from your OEM reps that is not showing up in the press releases? Product delays, allocation changes, price adjustments coming down the pipe? Reply and send it over.
MachineryBrief
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CITED SOURCES
Volvo CE Shippensburg production expansion and CONEXPO confirmation, Volvo CE press release June 2025 and CONEXPO recap: volvoce.com/global/en/news-and-events/news-and-stories/2026/ambitious-solutions-for-the-toughest-challenges-volvo-at-conexpo-2026 and businesswire.com/news/home/20250610258089/en/Volvo-Construction-Equipment-to-Expand-Production-in-North-America
Volvo CE production models EC140-EC500, Equipment World: equipmentworld.com/construction-equipment/article/15748170/volvo-ce-to-expand-us-manufacturing-in-2026
USTR Section 301 investigations, machinery and transportation equipment, March 11, 2026: globaltradeandsanctionslaw.com/ustr-section-301-investigations-into-structural-excess-capacity-16-economies
John Deere Q1 FY2026 earnings, Construction and Forestry results, February 19, 2026: prnewswire.com/news-releases/deere-reports-first-quarter-net-income-of-656-million-302692550.html
John Deere order bank signal and CEO commentary: fool.com/earnings/call-transcripts/2026/02/19/deere-de-q1-2026-earnings-call-transcript
Komatsu nine-month FY2026 results, January 30, 2026: komatsu.jp/en/newsroom/2026/20260130
Komatsu tariff exposure and price hike consideration: mining.com/web/komatsu-considers-price-hikes-in-the-us-in-response-to-tariffs
Doosan Bobcat drops Wacker Neuson bid, January 26, 2026: kedglobal.com/mergers-acquisitions/newsView/ked202601230001
Wacker Neuson acquisition talks confirmed: equipmentworld.com/business/article/15773180/doosan-bobcat-in-talks-to-acquire-wacker-neuson
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