Volvo will open U.S. assembly plant in 2018
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Automotive News Europe
March 30, 2015 06:30 CET
Volvo will spend about $500 million to build its first assembly plant in the United States as it pursues a global comeback under Chinese ownership.
Volvo is in advanced talks with several U.S. states and will announce a location for the factory within weeks, CEO Hakan Samuelsson said today. The plant will start operation in 2018 and will produce vehicles built with the same underpinnings as the XC90 SUV, Volvo said.
“Volvo Cars cannot claim to be a true global carmaker without an industrial presence in the U.S.,” Samuelsson said in a statement today. “The U.S. is an absolutely crucial part of our global transformation and today’s announcement makes it perfectly clear that Volvo is in the U.S. to stay.”
Following its sale to Zhejiang Geely by Ford Motor in 2010, Volvo has stepped up investment in new models and production, adding a pair of Chinese factories to its two older European plants in Sweden and Belgium.
Volvo said the new factory will help meet and eventually exceed its volume targets in the U.S., where it has a medium-term goal to sell 100,000 light vehicles a year.
Volvo's global deliveries rose 9 percent last year to almost 466,000, thanks to strong demand in China and Europe, while its U.S. sales fell 8 percent to 56,366 and last topped the 100,000 mark in 2007, when deliveries hit 106,213.
"We are going after a market share of 1 percent with a clear identity that we know is very attractive to some customer groups," Samuelsson said. "It is a tough market but I wouldn't say it's tougher than Europe or China."
Volvo executives have been hinting about a U.S. factory for the past two years. At the Detroit auto show in January, Samuelsson said in an interview with Automotive News that “long term, I would not rule that out.” At the Geneva auto show earlier this month Samuelsson said he favored a site in the U.S. over Mexico. “If labor costs are low, other costs are high,” he said. "Long term, it’s always good to produce where you sell.”
U.S. 'home market'
Premium rivals such as BMW and Audi are adding plants in Mexico, where labor costs are cheaper, to help them serve rising demand in North America. The choice of the United States over Mexico underlines Volvo's determination to "rebuild the brand" among American consumers, Samuelsson said. "We want to give a clear signal that the U.S. is a home market for us."
He declined to identify the shortlisted sites but said the decision would reflect the availability and cost of skilled workers and logistics including the export of finished cars.
Samuelsson said he was neutral on whether U.S. staff are represented by the United Auto Workers union - a politically divisive issue that has dogged plant decisions by Volkswagen and others. "It's up to the people who work for us to choose how they want to be organized," he said. "We have no opinion on that."
Volvo said it will use the U.S. factory to accelerate the introduction of build-to-order sales, as well as exports.
The new plant is part of an ambitious overhaul at Volvo that will see the automaker retool its entire product range over the next four years with the introduction of new modular vehicle technology.
The first vehicle developed under Volvo's Chinese owner Geely, the new-generation XC90, arrives at European dealerships in June and at U.S. showrooms in July. Sales already have started in both markets. Volvo is touting the crossover as the rebirth of the brand.
In four years, the redesigned XC90 will be the oldest vehicle in a Volvo showroom. Volvo executives say seven new vehicles -- replacements for the current range and some new variants -- will be launched by 2019. There will also be a plug-in hybrid in all new vehicle lines.
Diana T. Kurylko, Douglas A. Bolduc, Bloomberg and Reuters contributed to this report
Mentre Jaguar-Land Rover e' definitivamente uscita dalla fase post Ford, Volvo a 5 anni dal distacco dalla casa madre e dall'ingresso nella famiglia Geely deve ancora dimostrare di riuscire a stare sulle proprie gambe.
Un punto debolissimo degli svedesi e' il mercato statunitense, nei decenni scorsi era il loro primo mercato, riuscirono a vendere 150.000 unità all'anno ed avevano un'immagine ottima, le Volvo erano le auto dei professionisti col senso di understatement.
Audi, Mercedes e Bmw hanno divorato gran parte delle quote di Volvo che non riesce ad arrivare a 50.000 unità l'anno nonostante una discreta gamma.
Per ribaltare la situazione la dirigenza ha deciso di aprire una fabbrica negli States dove produrre un veicolo su base SPA (potrebbe essere la S60, la XC60, la nuova V70 o la prossima S80).
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