Volvo Aims to Boost Sales in China, Become Known for More than Safety

Volvo wants to increase its sales in China by at least 60% this year, to 50,000 cars, and to 200,000 by 2015. And how does the Swedish carmaker, which is owned by China’s Geely, intend to do so? By adding user-friendly comforts and a touch of luxury, according to Volvo’s CEO, Stefan Jacoby.

The reason for this shift is that Volvo’s greatest asset, safety, is not a unique selling point any more now that most rivals have made similar advances in this sector.

However, catching up the market leaders won’t be an easy task: “It will be very hard for Volvo to shake the market position of BMW, Audi and Mercedes in China” JD Power & Associates analyst John Zeng told Bloomberg.

The numbers consolidate Zeng’s opinion: Audi, one of the market leaders in the luxury segment, sold 121,614 units in China in the first half of the year, an increase of 28% compared to 2010. Similarly, BMW saw its sales rise even more, by 61%, to 140,699 cars, and Mercedes-Benz by 52% to 92,174.

Volvo has also seen a 36% increase in sales during the first half of the year – by no accounts a negligible achievement. However, it still lags behind its competitors, selling just 21,028 vehicles. So Jacoby’s plan seems very ambitious.

That is because Audi, BMW and Mercedes have been regarded as status symbols for a long time. However, Zeng claims Volvo has the opportunity to win customers from brands such as Lexus and Infiniti because of its better brand perception.

Analysts point out that safety will continue to be a strong selling point, as Volvo is still developing new technologies such as the Pedestrian Detection System. But as its range expands with models like the all-new S60, it needs is to get its marketing strategy together and appeal to people who appreciate luxury and, of course, safety, but don’t want to show off.

Source: Bloomberg

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