Volvo set to roll out assembled cars under 'Make in India' initiatives

Fernando Stephens
May 18, 2017

The XC 90, a premium SUV model, will be the first model to be assembled locally.

The assembly operations, to be located near Bangalore, will focus on models based on Volvo's SPA modular vehicle architecture.

Volvo's decision to start assembly in India and market its vehicles as "Made in India" fits well with a similarly named initiative launched by the national government several years ago, which seeks to highlight and promote Indian manufacturing prowess.

Financial details of the deal were not disclosed. The move to begin local assembly, which positions the company for speedier growth in the fast-expanding premium vehicle segment, comes 10 years after the Swedish carmaker entered the Indian market.

Swedish luxury carmaker Volvo Cars Global on Thursday announced setting up an assembly plant near Bengaluru in India this year.

Adding to this Managing Director Volvo Auto India, Tom von Bonsdorff said that it is a sign of the company's strong commitment in India, which is backed by a robust sales growth, expanding network and an array of new product launches.

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Swedish carmaker Volvo announced its plans to start vehicle assembly operations in India this year that will bring down the tax component substantially and enable the company to take on dominant German luxury carmakers.

Volvo now sells nine luxury models in India, including sports sedan Volvo S60, performance sedan Volvo S60 Polestar, premium sedan Volvo S60 Cross Country and luxury hatchback Volvo V40. After growing by 32% over the past two years, the company plans to sell 2,000 Volvos in India this fiscal, to continue growing at 25% year-on-year.

Sales of luxury cars in India slowed over the past three years, which were marked by a ban on the sale of diesel cars in Delhi in 2015 and demonetisation of high-value banknotes in November 2016.

Volvo Cars is owned by Zhejiang Geely Holding (Geely Holding) of China, which acquired it from Ford Motor Co in 2010.

While sharing the Volvo name, Volvo Cars has not actually been part of the Volvo Group since 1999, when it was initially taken over by USA giant Ford and subsequently acquired by China's Geely Group in 2010.

Other reports by BadHub

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