Volvo's Crystal Ball Sees Good Things Ahead; No Second U.S.-built Model Anytime Soon

After surviving a very rough patch that could have easily sunk it for good, Volvo is feeling confident enough to be boastful, albeit in a restrained, Scandinavian way.

The Swedish automaker is riding high after posting record worldwide sales last year, and its CEO claims the groundwork is in place to have that trend continue in 2017 and beyond. Part of that optimism lies in a South Carolina plant expected to come online in 2018.

While the Berkeley County plant will be home to the next-generation S60 sedan, a second promised model is no clearer now than when shovels broke ground in 2015.

Volvo sold 534,332 vehicles in 2016, 82,724 of them in the United States. The American figure represents the brand’s best sales year since 2007, when the then-Ford-owned company was in the midst of a steep sales slide. Since being dumped by a recession-panicked Blue Oval and finding salvation at the hands of China-based Geely, the automaker has faced a long road back to prosperity.

Well, good times are back in Gothenburg, baby!

“Barring any major unforeseen changes to the market, we should be able to crank out more cars than last year,” said CEO Hakan Samuelsson in a recent interview with Automotive News Europe.

The biggest feather in the company’s sales hat is the critically acclaimed Volvo XC90 SUV, offered in a Europe-friendly plug-in hybrid variant. That model bowed in mid-2015 and is almost solely responsible for the brand’s image makeover, if not for its sales surge. This past year, the S90 executive sedan and its V90 wagon partner injected a competitive offering into the premium passenger car segment.

Next up? More utility vehicles, starting with the compact XC40 due for an introduction later this year. That model will share its new platform with a second small vehicle.

“We will continue increasing our percentage of small cars,” said Samuelsson. “That, of course, is a very important factor for better margins. In addition, we aim to have a volume increase. We are ramping up to see how much we can reach.”

A new XC60 is also on tap for this year. While crossover and SUV sales catch fire globally — to the detriment of traditional car makers — the high-volume XC60 needs help staying relevant. Sales dropped in the U.S. last year, though it remains the brand’s best-seller.

The S60, on the other hand, doesn’t just need help — it needs an intervention. The midsize sedan has seen its U.S. sales sink each year since 2012. That’s where Volvo’s South Carolina plant comes in. Volvo claims the next-generation S60 will roll out of the plant in late 2018, with production evenly split between units bound for domestic and foreign markets.

Samuelsson said that extra production could come from China or Europe if sales of the new model really take off, but with passenger car sales being what they are, that’s wishful thinking. As for the second anticipated American-built model, well, don’t hold your breath. All planned models currently have an overseas home, including the wagon variant of the next S60.

“One day we will probably need a second car in South Carolina, but for now it is just the S60,” the CEO said. However, if Volvo decides to build something new using the S60’s platform, expect a quick turnaround.

“If you use the same underpinnings and only change the top hat, it would be really quick,” he claims. “Less than a year.”

[Image: Michael Sheehan/ Flickr ( CC BY 2.0)]