New Volvo owners Geely want the firm to move upmarket, building more luxury cars

The new owners of Volvo want to see the company build flagship executive cars to compete directly with BMW and Mercedes.

Speaking shortly after taking control of Volvo from Ford, Geely boss Li Shufu said he wanted to see the Swedish carmaker make more “high level cars that compete with the Mercedes S-Class and BMW 7-series”.

Read the full story on Volvo's sale to Geely

Shufu told a press conference in London that Volvo had the technology and research capabilities to compete at the top end of the market as well as demand higher retail prices.

Shufu’s also made clear that a push into the booming Chinese car market would demand luxury that Chinese customers could “see through their eyes and touch with their hands”.

However, such comments also indicate the pressure the new Volvo board (and new, ex-VW, boss Stephan Jacoby) will be under to retain Volvo’s Scandinavian brand values as well as appeal to China’s more glitzy tastes.

Geely paid just over £1bn to buy the loss making company and reportedly wants to nearly double sales from last year’s 335,000 units. Volvo made losses of around £400m last year, but says that a relatively modest increase in sales should tip it back into profit. See all the latest Volvo reviews, news and video

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15

4 August 2010

Wow, making a luxury car is a tall order for established contenders never mind someone new to the game, like Volvo. I've always seen Volvo as the nice, sensible brand which makes those safe family cars. If I'm not alone in thinking this - and I suspect I'm not - then Volvo's got a hell of a lot of work to do.

Volkswagen has really struggled with its Phaeton, but it's a good effort and one they should improve on with the next generation. I can see a big, luxury Volvo competing with that, but is there room for the both of them in the most perfectionist segment of them all?

4 August 2010

[quote Dark Isle] I can see a big, luxury Volvo competing with that, but is there room for the both of them in the most perfectionist segment of them all?
[/quote]

Agreed. Volvo has form for doing big comfortable cars in the past, and their S60 (todays road test) is well-equipped and comfortable. Although no doubt a new limo this will be intended in some way for the Chinese market, it will be interesting to see if it prospers or trickles along like the Phaeton, Legend, Xedos 9 et al...


4 August 2010

Absolute rubbish, at this end of the spectrum, brand matters a lot. I don't think the difference is huge between the 7 series, S-class or A8 in terms of the cars' capabiltiies or perceived quality, but people have tastes that are tied to brand. It's why I would never buy a Lexus, because to me it's a tarted up Toyota and there's no way I'd pay premium money for that when I can get the real thing. The same will apply here.

4 August 2010

From the news in Autocar on 02 August: “Volvo is an excellent brand with a strong product line, and it has returned to profits after a successful restructuring,”Alan Mulally, Ford’s president and CEO. And from today news: "Geely paid just over £1bn to buy the loss making company and reportedly wants to nearly double sales from last year’s 335,000 units. Volvo made losses of around £400m last year, but says that a relatively modest increase in sales should tip it back into profit". Confusing? Anyway, Chinese win! Excellent move, resembles to the one Fiat made on Chrysler!

4 August 2010

Obviously, Volvo have never heard of the Phaeton and its sales success (or lack of). Volvo could build the best luxury car in the world, but it will never match those of Mercedes, BMW or Jaguar simply because of the badge which has no more kudos than a VW in terms of brand image. Lexus' LS still can't quite make a major impact after 21 years, while Audi still continues to struggle with the A8.

4 August 2010

Whilst Volvo Car Corporation lost money in 2009 recovery had started by the end of the year and so far this year it has been profitable - $49million in quarter 1 and $53million in quarter 2. The news is buried in Ford's accounts as they seem to want to give the impression that they are not selling an asset which, when managed properly, is capable of making money.

Good luck Geely!

4 August 2010

What a waste of time. Volvo should focus on beating VW not BMW.

4 August 2010

Geez, guys--irresponsible much?

Check out the Financial Times report on this subject:

'Volvo’s new chairman added that the remarks were “my personal thought or idea”, and that the final decision lay with the carmaker’s new board.'

Translation:

1. There are no official plans to build a 7 Series rival

2. The idea is from the owner (singular), not "owners".

4 August 2010

I'll amend my words; 'irresponsible' is not accurate, but 'shoddy' probably is...

4 August 2010

I desperately want to be positive, to say 'yes, of course, Volvos a great brand that's going to do well', but, somehow, between the fact that it's the bling-loving Chinese who're pushing this, and the possibility that it'll end up as another Phaeton/Legend, I have a horrible feeling about it.

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