Volvo sales up this year but ambitions remain distant

Volvo benefited from a 6 per cent rise in global sales in November, with demand in China and, somewhat surprisingly, Europe offsetting continued losses in the
brand's traditional heartland of the US.

Chinese sales were actually up a whopping 69 per cent, but its position in the US remains weak, down 31 per cent, as buyers desert its traditional estate models in search of SUVs from other brands. Volvo’s XC series has done reasonably well in the States, but performance in America remains a sore point for the Swedish company.

An 11 per cent improvement in Europe is good news though, especially as Volvo now has its new family of low-emissions four-cylinder petrol and diesel turbo engines on the market now. Its core S60 model can now be had with a 99g/km unit, which should boost sales to tax-conscious corporate fleets.

"Sweden and China are very strong, Europe shows a positive trend and in the US we now have the right tools to get back on track," Alain Visser, sales and marketing chief, said.

Volvo has plans to double its current sales to about 800,000 units a year, a number which it believes guarantees its independence and will allow it to fund investment in future new cars. The Swedish car-maker was bought out from under the Ford empire in 2010 by Chinese car-maker Zhejiang Geely, and that Chinese connection is most likely the key to Volvo's future wellbeing.

The two companies are jointly working on a new affordable brand to be sold in the Chinese market, engineered in Sweden but built in low-cost Asian factories. Whether or not those models will contribute directly to Volvo's coffers remains to be seen but that 800,000 sales target has been an aspiration for some years now. However, this year so far, Volvo's
numbers still have not breached the 400,000 mark.

What does this mean for Volvo in Ireland, where the brand has also seen a steady decline in recent years as buyers have deserted it in favour of the German premium marques?

"European automotive sales have been struggling for most of 2013, so it is really heartening to see the recent positive performance for Volvo Car Group in Europe, but particularly in China," said Adrian Yates, MD of Volvo Car Ireland.

“Since its sale to Geely Holdings in 2010, Volvo has invested heavily in new car development and new engine technology, as well as in production facilities in China. The long-term goal is to sell up to 800,000 cars a year by 2020 and this is moving in the right direction. Strong sales have been booked globally on XC60, new V40 and S60 saloon.”

According to Yates, Volvo in Ireland is starting to gain ground again, with dealers reporting improved forward sales for 2014. “This is thanks to the introduction of finance via Personal Contract Plans as well as very competitive offers on V40, S60 and XC60. 2014 will see the run-out of the current large SUV XC90, which has been very successful on the Irish market for many years. Its replacement should be with us this time next year and is certain to feature in our sales drive for 2015.”