Volvo says that it might reach the 2020 sales target in China two years earlier, as a new plant in the region heads towards full production capacity this year.
Two years ago, after the automaker was acquired by Zhejiang Geely Holding Group, Volvo set a sales target in China to 800,000 vehicles by 2020, from 373,000 vehicles sold in 2010. In China, its second market after the US, Volvo competes with Jaguar, BMW and Audi. Vehicle sales in China increased 13.4% in April compared with the same period last year and 10.7% from March.
Although Volvo did not manage to increase sales in China as much as it planned in 2011, this year it relies on a boost in local production, as well as changes in how it manages its network of retail showrooms. The automaker relies on its new plant in China, which currently manufactures a limited number of vehicles to test the facility’s production processes and quality, but full production is expected during the fourth quarter, reaching 125,000 units annually.
Volvo also builds a second plant in China, located in the north-eastern city of Daqing, but production here will begin at the end of 2014. Once the Chengdu plant will reach full production, the automaker will be able to hit the 200,000-sales goal in China set for 2020, with two years earlier.
“If we stick with the strategy and implement the plans as envisioned, I am positive we’ll reach the goal five years from the start of full localisation of production,” said Volvo spokesman Per-Ake Froberg.