In a surprise move Volvo has bought Ingersoll Rand''s road development division for a sum of US$1.3 billion. This acquisition leapfrogs Volvo into a leading position in the market for road construction machinery. Ingersoll Rand''s paving machines number amongst the world''s market leading brands and the compactors are amongst the market leaders in the US. Ingersoll Rand recently re-entered the milling machine market with a new line of machines.

Volvo is a major player in the earthmoving equipment market and this move into the road machinery sector is entirely complimentary. Volvo''s purchase comes at a time of intense competition and consolidation in the road equipment sector. Atlas Copco recently bought fellow Swedish Dynapac for example.

There had previously been considerable industry speculation that Volvo was in the running to buy Dynapac. Volvo is in strong financial shape and has been open about its intention to buy other businesses. With the acquisition of Ingersoll Rand''s road machinery range, this gives Volvo additional product lines. Volvo is not the first earthmoving equipment manufacturer to broaden its range into road machinery though as Caterpillar first took this route some years ago.