Volvo Car to increase focus on manufacturing in India

STOCKHOLM: Within a year of setting up its plant, Volvo Car India plans to accelerate its manufacturing footprint in the country. The company expects majority of its product portfolio to be locally manufactured in the coming two years as it aims to compete more strongly with German rivals — Mercedes, BMW and Audi.

The company is likely to begin production of yet another car at its Bangalore factory in the second half of 2018 and eventually add more models in the following year. Currently, it produces the seven seater SUV XC90 and S90 in the country.

Volvo Car India MD Charles Frump, who was here in Sweden to take part in the CEOs round table with Prime Minister Narendra Modi at the Stockholm city hall, said, “We are assembling two of our cars — XC90 and the latest inclusion this month S90 — at our Bangalore plant. While the former contributes 20% to our sales volume in India, the S90 comprises 10%. So, a total of 30% of our sales in India are manufactured from our plant there. However, we would like to produce at least half of our volumes in India by producing a third car.”

Declining to give specific details, Frump said, “It may be a shorter or longer version on our current Scaleable Platform Architecture (SPA).” To further expand its volume game in India, Volvo Car will be launching its smallest SUV XC40 in the early second half of 2018, which is expected to help the brand sustain its strong double digit growth momentum and build its market share in the faceof stiff competition.

Volvo marked a robust 28% annual growth in volumes, ending the calendar year 2017 with highest ever 2,029 retails. The company plans to double the segment share to10% by the end of 2020.

The company is also planning to expand its plug-in hybrid and electric vehicle portfolio in India. “In 2019, every new car that we launch would be electrified. We will not have internal-combustion-engine only cars. Our vision is that by 2025, we would have launched one million electrified cars globally. This is our shared vision with India as the country plans to achieve e-mobility ambition by 2030. But we feel there is a gap in policy in India. There is no tax incentive for hybrid or plug-in hybrid cars,” he said.

Volvo India