Truck maker Volvo announced plans to increase heavy truck production capacity by opening a new plant in Mexico within the next two years.

On April 11, Volvo Group announced plans to build a new heavy-duty truck manufacturing plant in Mexico, which is expected to be operational by 2026.

The company says that the new plant will provide production capacity for both Volvo Trucks and Mack Trucks in the U.S. and Canadian markets, and support Mack truck sales in Mexico and Latin America.

“Adding production in Mexico will deliver logistical efficiencies for supporting sales to the southwestern/western regions of the U.S., and to Mexico and Latin America. It also provides a mature supply and production ecosystem that will complement the U.S. system and increase the resilience and flexibility of the Group’s North American industrial footprint,” Volvo Group said.

Volvo plans to continue to rely on the Mack LVO plant in Pennsylvania and the Volvo NRV plant in Virginia as its main production sites for North American trucks.

Volvo says that it has invested $73 million in upgrades to the Pennsylvania plant over the past five years.

Additionally, Volvo spent $400 million over the past six years upgrading the Virginia plant for the production of the new Volvo VNL model.