Volvo Has A Plan

Bertel Schmitt
by Bertel Schmitt
volvo has a plan

Today was the big day when Geely-bought Volvo wanted to announce its plans for the future. They did not disappoint.

First, they need a new plant in China. Former VWoA and now Volvo CEO Stefan Jacoby, who wants to sell about 200,000 cars in China by 2015, said: “We regard the Chinese market as the second home market for Volvo Car Corporation and a very important part of the plan to build a successful future for the company.”

Several cities had been vying for the Volvo plant. The Jiading District of Shanghai and the city of Daqing in the northeastern province of Heilongjiang were seen as top contenders. They had helped with the financing of the deal.

Jiading will get Volvo’s Chinese headquarters and design center. Daqing will get nothing for the time being.

Volvo will “build a new plant in the southwestern city of Chengdu with capacity to produce 100,000 cars a year,” reports the Financial Times.. As far as Daqing is concerned, Volvo will “continue investigations” for a plant there.

Going to Chengdu will please the Chinese central government. It plays right into their “go west” policy. There are a lot of inducements for big companies that move their plants into the wild and open west, away from the heavily populated eastern seashore.

It is important for Geely owned Volvo top establish good relationships with the government. The Chinese government is the biggest buyer of cars in the country. The announced policy that 50 percent of the government cars should be Chinese has been largely ignored. Volvo is Chinese now.

And of course, Volvo is looking to export the cars. With the Volvo brand Geely is the first Chinese company that has a real chance to be a player on the world market.

“It is obvious that at some point manufacturers will export from China,” Jacoby told Bloomberg. “We, as a global premium brand with European heritage, have a very good opportunity to be owned by a Chinese enterprise and to utilize our manufacturing capacities here.”

Volvo Cars plans to invest as much as $11 billion worldwide over the next five years to successfully sell its cars to China and the world. In 10 years, Volvo wants to sell 800,000 cars. Not an unrealistic target.

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  • Sam P Sam P on Feb 26, 2011

    "Norma; My laptop and all electronics are from Taiwan, S Korea. I do not own an Apple anything, nor will I. Everything that is purchased for me personally or for the company is searched for origin. Not only company HQ, but actual fabrication." If you own a Taiwanese or Korean laptop, odds are it was made in one of the same Foxconn factories in mainland China that make Apple products. No one who owns or purchases modern electronics can avoid Chinese components. Fact of life. Deal with it.

  • Aviator Aviator on Feb 26, 2011

    Sam P, you're right; it may be impossible to totally avoid Chinese-made goods without living in a cave. But I don't see what is wrong with someone, for reasons of concience, attempting to minimize the money they send to a place that tramples on the human rights of its citizens and badly exploits the workers who make the products sent our way.

  • Gabe Awesome. Owners can cook their DNA with EMFs while watching YouTube now.
  • Cardave5150 Why oh why are they resurrecting the ZDX name??? It’s not like the last one was anything other than an overpriced freak show. Just use 3 other random letters!
  • Gemcitytm Why does it seem every EV seems to have ridiculous amounts of power? Yes, I know they're heavier than ICE models but who on earth needs 708 HP? How about a nice, compact EV with, say, 250 HP and 350-400 mile range? Is that impossible with today's tech? (I currently drive a 148 HP Mazda 3 ICE and it has all the get-up-and-go I need.)
  • CEastwood I could have bought one of these if I had the cash in 76 for $1000 white , red interior , 3 speed stick with whitewalls/ wire hubcaps - it was mint and gone a day after I saw it . But the real catch that got away was an all original 69 green Camaro RS convertible 327 4 speed with 46K on the clock for 1800 that I saw a few months earlier . Young and poor was not a fun place to be !
  • KOKing I'm in an emissions check only state, and I'd trade that away for a safety check all day.