Currently reading: Clash over Volvo's future
New parent firm Geely wants to take the firm upmarket - but current management disagrees

Existing Volvo management disagrees with new owners Geely over the direction the company should be taking.

This is according to Li Shifu, president of the Chinese firm Geely, which took control of Volvo from Ford three months ago. At the time of the takeover, he spoke of his desire to push the firm upmarket, building “high-level cars that compete with the Mercedes S-Class and BMW 7-series”.

Full story - Volvo rules out 7-series rival

But new Volvo CEO Stefan Jacoby believes that creating such cars “is a step too early” and the firm should instead concentrate on smaller, more fuel-efficient models that will allow the firm to achieve its annual sales target of 800,000 units by 2020, double what it is at present.

Despite Shifu's disagreements with Volvo management, he said he would be willing to give in. "Why?," he said, "because they have brought Volvo to where it is today. So, they must have good reasons [for ruling out larger models]."

Jacoby told Autocar earlier this month that Volvo needs to “focus on luxury” and “has lost its distinguishing points in its products”. He also said the brand must “stop copying the Germans”.

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optimal_909 17 November 2010

Re: Clash over Volvo's future

thebaldgit wrote:
The Volvo - Geely honeymoon period did not last long.
I think it is simply a lack of experience at the Chinese side how to handle such internal communications. The way I look it is positive that the owner backs down in favour of the management. As others wrote, Volvo needs both compact models for the EU market and "executive" size sedans for the Chinese. But in any case the development must follow European standards and it is the C30 what needs replacement soon. I'm now in China (for the second time) and noted that Volvo can be seen on the streets, mostly black 2.5T S80s. The brand has definitely a potential now that the Chinese are backing it - and if Buick could become the most popular (semi-premium) brand...

cimardinius 17 November 2010

Re: Clash over Volvo's future

Flash Harry wrote:
Shifu would do well to listen to Jacoby and the current management team.The downsizing trend will continue and Volvo need to get involved too.They need to regain their Swedish mojo too as in stylish and understated imho

Here here

jer 17 November 2010

Re: Clash over Volvo's future

Could it be the Euro centric market is wholly different to the chinese. So do you create a Volvo brand for big luxury cars in China where peoples brand tastes are not yet entrenched or focus on small "e" cars for europe/USA where Volvo plays catchup to to the Germans. The answer has to be delivery both for Europe and China or deliver the Chinese option. The European small car appraoch is not an option on it's own. I'm reminded of the Lotus scenario applied in this case to volume not profit. Volvo have been chasing for years in Europe and USA volumes and never achieved it perhaps it is time to change. How the world has changed in the last few years.