One of the most esteemed car makers in the world, Volvo, already has made a significant place in the Indian market through its Indian subsidiary, Volvo Auto India. The managing director has expressed his desire to extend the percentage it holds in the market, to 4.5% by the end of 2013.
Volvo is a Swedish car manufacturing company, centered in Gothenburg. The Volvo group was formed in 1915 but the automakers came into existence in 1927. Today Volvo manufactures and sales trucks, buses, marine vessel parts, and even cars. In India, it specializes in making luxury cars.
The company’s MD, Tomas Ernburg, said in an interview that Volvo Auto India has seen a steep progress curve in the country. It had only 1% occupancy in the market in the year 2011 and in the year 2012, it had secured 3% occupancy. He said that Volvo will progress more and by the end of this year they will acquire 4.5% hold over the Indian luxury car market. Tomas also expressed his long term desire and plan of holding 15% market ownership by the year 2020.
Volvo Auto India emerged in the year 2007 and sold only 320 cars by the year 2011.
But now it has reached a sale of 850 cars across India. It has expressed the desire to sell 1000 cars by the end of this year.
It’s latest venture is V40 that was launched in Hyderabad. V40 is a luxurious Cross Country car. It has an engine of 2 litre capacity. It has an automatic six- speed transmission in addition to a glass roof. It plans to sell 120 V40 units by the end of this year. It is priced 29.25 lacs rupees.
Volvo Auto India is planning to increase its area in the county and so is planning to open new retails in cities like Vishakhapatnam, Kolkata etc.
Auto major, Volvo Auto India intends to introduce less costly variants of their models, as they hope to increase their sales volume in a market where competitors like Mercedes, Audi and BMW are seeing growth in their premium car sales.
The newly appointed MD of the company, Tomas Ernberg, said that they may consider doing away with some features so that their models can be more competitively priced.
Currently in India, Volvo does not manufacturer any cars. Their present product portfolio includes a variety of imported products, which make them expensive when compared to their competitors. Volvo cars are available in a price ranging between INR 38 lakhs to INR 55 lakhs. Moreover, India also has a high import duty of 110% that makes it unviable to price their models competitively.
Stripped down versions of Volvo cars will help to bring down their prices as well as compete with their rivals like Audi, Mercedes and BMW. Many German premium car brands have their assembly operations for most of their models in India. They also offer exclusive limited editions priced competitively for luring more customers.
Volvo Auto India recently announced that they have appointed a new MD, Tomas Ernberg for their domestic operations. Ernberg has been with the Swedish auto manufacturer since the past 17 years. He will replace current MD, Paul de Voijs.
Ernberg, who will be responsible for the overall operations and planning of the company in India, was earlier posted as a regional MD in Dubai. In his last position, he took charge of 13 different markets in North Africa and West Asia.
Ernberg said that the Indian auto market is among the fastest growing auto markets for the company, and holds a lot of promise. They have invested a lot of effort and time in understanding their customers in India, as well as providing them with international standard products. He personally wishes to learn from all the different challenges that this market could bring.