Volvo claims to sell cars in the United States this year

People familiar with Volvo's plan stated that Volvo Cars plans to export Chinese-made medium-sized four-door sedan to the United States this year, and is starting to weigh the possibility of setting up a car factory in the United States.

These two initiatives are major events for the automotive industry and Volvo’s parent company, Zhejiang Geely Holding Group Co., Ltd. So far, global automakers have chosen not to export large quantities of Chinese-made cars to the US market, and Chinese automakers have failed in their efforts to export automobiles to the United States.

In terms of setting up production facilities in the United States, Volvo also lags behind rivals BMW Motors and Mercedes-Benz, setting up factories in the United States to prevent these German brands from fluctuating exchange rates.

Geely executives said that Volvo may also export a large "strategic flagship" sedan based on a new development platform. In addition to the Volvo S60L, Volvo's long-wheelbase version of the S60 four-door sedan produced in Chengdu, a city in southwest China, the vehicle will also be exported outside of China.

These initiatives aim to restore Volvo’s sales momentum in the United States. Last year’s sales in the United States fell by 8% from 2013 to 56,371 vehicles. For a long time, the United States has been Volvo's largest market until last year it was replaced by China. China sold 81,221 Volvos in 2014, an increase of 33% year-on-year.

In a broader sense, these initiatives are part of Geely's Volvo rejuvenation strategy. For a long time, Volvo has been striving to break away from the brand that sells less than 500,000 vehicles a year. Thanks to its focus on the Chinese market (Volvo expands its distribution network and product portfolio in China), Volvo sales are also rising. Last year it sold a total of 465,866 cars worldwide, a 9% increase over 2013.

Long-term goals

“The S60L offers the same leading rear space, which is exactly what US customers have been demanding. The car will be manufactured at the Volvo plant in Chengdu, China, and will be exhibited this year at the North American International Auto Show in Detroit this year. ,” said David Ibison, a spokesman for Volvo in Gothenburg, Sweden. "The S60L only forms part of our American revival plan."

Ibison said that Volvo plans to launch seven new products by 2018 and increase its sales in the United States to 100,000 vehicles per year in the middle of the plan. However, he declined to give details.

Exporting China's mainstream passenger vehicles to the United States and other developed markets has been a long-term goal for Chinese automakers - and it is also a goal that has largely stunted the Chinese auto industry.

"This will be a major breakthrough," said James Chao, Asia Pacific director of consulting and research company IHS Automotive, not only for Geely but also for the entire automotive industry in China.

“Volvo is not a Chinese local brand, but it is a Chinese-owned company. Maybe this will become an example and strategy that can ultimately work for Chinese companies struggling to enter the US market and other markets.”

Chao added that Geely can follow Volvo into the US market with its own products, perhaps using Volvo's production and parts supply chains.

Geely bought Volvo from Ford Motor Company five years ago. This surprised many in the automotive industry. They wondered whether a relatively newcomer in the automotive industry could protect this Swedish country with a history of almost 90 years. At the same time as the company’s well-known brands, the company’s renaissance was realized.

The S60L was originally developed as a special Chinese model to cater to the needs of wealthy Chinese consumers who prefer cars with spacious, comfortable rear seats. Volvo expects to import about 1,500 Chinese-made S60L cars to the United States this year, and the car is expected to sell 26,000 vehicles in China this year.

The executives said Volvo plans to export another vehicle to the United States as a large flagship four-door sedan, which may be called the S90. The car will use Volvo's new vehicle platform, which is called "extensible platform architecture." The S90 will be the second car based on the new architecture following the redesigned XC90 SUV.

At the end of 2013, Volvo announced that it will produce a "large-scale high-end four-door sedan" based on the new structure at its new factory in Daqing, a city in northeast China.

In Daqing, Volvo started production of the XC Classic in September last year. This is the previous model of the redesigned XC90.