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Mack Awarded Hybrid Electric Truck Contract
Company to Design Refueler for Air Force

LEHIGH VALLEY, PA (January 16, 2004) - Mack Trucks, Inc. recently received a $1.2 million contract through Southwest Research Institute to develop diesel hybrid electric technology that will ultimately be used in military and commercial vehicles. The majority of the work is to be performed at Mack Powertrain in Hagerstown, MD.

The project involves designing a hybrid vehicle to be used for refueling operations at U.S. Air Force bases. The long-term goal is to develop heavy-duty trucks that operate on a combination of electricity and diesel fuel. Anticipated advantages of this hybrid electric technology include better fuel economy, longer engine and brake system service intervals, and reduced emissions.

"For more than four decades, Mack Powertrain has been at the forefront of engine technology. And this project provides yet another opportunity for us to demonstrate our research and development capabilities," said Denis Leblond, Mack Powertrain senior vice president.

Leblond noted that a likely commercial use for the technology is a refuse hauler based on a Mack® truck platform. Mack is the leading manufacturer of refuse vehicles in North America with approximately 70 percent of the market.

"We believe this technology shows promise in the refuse vehicle area for the same reasons that the Air Force is interested in the refueler—reduced cost of operations and emissions without loss of performance," said Guy Rini, Mack program manager for the hybrid technology project.

Rini said Mack Powertrain has already defined a prototype vehicle configuration and, in conjunction with strategic partner Enova Systems, Inc. (symbol: ENVA), initiated design work on the motor and drive electronics. The goal is to deliver a working prototype to the Air Force by March 2005, he added.

Both Leblond and Rini acknowledged the efforts of U.S. Rep. Roscoe Bartlett, R-Md., and Sen. Barbara Mikulski, D-Md., who played key roles in shepherding the refueler project through the appropriations process in Congress.

Since Mack established the Hagerstown facility in 1961, the plant has received the US Senate Productivity Award for Maryland, and earned registration of its quality system to the ISO 9002 international standard and the ISO 14001 international environmental management standard. Located about 75 miles northwest of Washington, DC, the facility sits on approximately 281 acres, and has a total area under roof in excess of 1.5 million square feet. More than 1,100 employees currently produce 110 engines and 28 transmissions daily.

AB Volvo recently announced that its Volvo Powertrain unit will invest 155 MUSD in the Hagerstown facility to prepare the plant to build the next generation diesel engine family for the Volvo Group's two North American brands- Mack and Volvo.

Dedicated to quality, reliability, and total customer satisfaction, Mack Trucks, Inc. has provided its customers with innovative transportation solutions for more than a century. Today, Mack is one of North America's largest producers of heavy-duty trucks, and MACK® vehicles are sold and serviced in more than 45 countries worldwide.

Mack is a member of the Volvo Group, a publicly held company headquartered in Gothenburg, Sweden. With annual sales of approximately $20 billion, Volvo business areas include heavy trucks, buses, construction equipment, marine and industrial drive systems, aerospace, and financial services. In the United States, Volvo shares are listed on NASDAQ and are traded as ADRs (symbol: VOLVY).