Volvo targets China's rich in $11 bln global push
(Fixes typo in first paragraph) * Volvo to invest $10-$11 bln worldwide over 5 yrs
* Eyes 200,000 unit sales annually in China by 2015
* Targets 20 pct of China's premium market
* CEO says to invest in more upscale autos
By Fang Yan and Ken Wills
BEIJING, Feb 25 (Reuters) - China's Geely-owned Volvo will invest $10-$11 billion over the next five years, with most of that aimed at new products including more upscale cars in China, the world's largest auto market, its chief executive said on Friday.
Stefan Jacoby, in an interview with Reuters in Beijing, said the Swedish auto maker hopes to be selling 200,000 vehicles annually in China by 2015, and has set a goal of capturing 20 percent of the country's premium auto sector.
Jacoby is in Beijing to unveil the Swedish brand's China development strategy, seen as essential to the bolster the Swedish brand's global profile. Expanding in China is central to Volvo's longer-term goal of doubling sales to 800,000 units globally in 10 years, Jacoby has said.
Geely, parent of Geely Automobile Holdings (0175.HK), bought Volvo from Ford Motor (F.N) for $1.5 billion in August 2010, marking China's largest overseas auto acquisition and reflecting the country's rapid rise in the auto world. [ID:nTOE67103B].
SPECIAL REPORT on Geely's Volvo buy: r.reuters.com/feb98m
China's top selling cars: link.reuters.com/kek55r
China auto sales: link.reuters.com/dem55r
But Volvo's new chairman, Li Shufu, and his team face an uphill battle to bolster the global status of the Swedish brand, which last year managed to make a profit for the first time since 2005.
Volvo currently lags its rivals but is aiming to increase sales in the country from a little over 30,000 last year, its China chairman, Freeman Shen, told Reuters in January. [ID:nTOE70A08A]
Geely's Li said in September that Volvo may need as many as three car plants in China with a combined annual capacity of 300,000 units. [ID:nTOE68D027]
Sources told Reuters this week the company will start to making cars at its first China plant in Chengdu in 2013, where it will produce mid-sized cars as well as models transferred from Ford's China car plant in nearby Chongqing municipality. [ID:nTOE71H04R]
After the landmark Geely-Volvo deal, Li told Reuters that he wanted to build bigger Volvo cars to compete with BMW's (BMWG.DE) 7 series and Mercedes Benz's S series.
In the interview, Jacoby denied speculation that Li's strategy was in conflict with that of the board, which was said to favour smaller, less expensive vehicles.
(Editing by Lincoln Feast)
((email@example.com; Reuters Messaging: firstname.lastname@example.org; +86 10 6627 1233))
((If you have a query or comment on this story, send an email to email@example.com)) Keywords: VOLVO CEO
- Tweet this
- Share this
- Digg this
- Exclusive - Over 100 Russian soldiers killed in single Ukraine battle - Russian rights activists
- Scotland's pro-independence campaign gains on final TV debate - poll
- Russia says military planning will take account of NATO moves on borders
- Analysis - Bitcoin shows staying power as online merchants chase digital sparkle
- Ukraine president accuses Russian soldiers of backing rebel thrust |