Volvo Cars says it has a ‘huge opportunity’ to use domestic facilities in China for export purposes as the Gothenburg manufacturer hailed its relationship with owner, Zhejiang Geely, as a means to lever influence within the Chinese market.
The Swedish automaker was acquired by Geely in 2010 and has local production in Chengdu of models such as the S60L, while the dealer network has also undergone enlargement.
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“We can use a very open and honest partner with Geely,” said Volvo president & CEO, Hakan Samuelsson, at the opening session of this year’s Automotive News World Congress in Detroit. “We have [a] privileged entry card to the Chinese market.
“We will have local manufacturing in China, not necessarily for local demand. We are the only one who can think of using the factory for export, which of course, we will be doing. This is a huge opportunity.
“There is no negative to a Volvo produced in China, as there is little negative with an iPhone produced in China.”
The Volvo chief also cited the automaker’s intention to secure new supplier business in China as “healthy competition” for component producers in Europe.
Last year, China Development Bank agreed to lend Volvo Group US$800m until 2021 – the second deal the manufacturer has brokered with the financial institution since 2012.
The loan is on the same terms as the EUR922m deal the automaker and bank agreed two years ago.
Turning his attention to the US, Samuelsson noted the existence of a new management team in place to “revitalise” the brand in America. “We are going to stop copying what others are doing,” he said.
Volvo was now “back in the black,” noted the CEO, following an evaluation of the company’s cost structure.
“Last year was a good starting point for our business.” he said. “Our cost structure, we have under control.”
See also: DETROIT SHOW: Volvo Cars ‘back in the black’
