Wednesday, 27 July 2011

Volvo to introduce corporate luxury sedans in India next year

Swedish automobile manufacturer Volvo Cars Corp is considering introducing corporate editions of its luxury sedans S60 and S80 to shore up volumes in the Indian market.
Tomas Ernberg, the new managing director for Volvo Auto India said, “We are looking at introducing stripped-down version of our luxury sedans. The corporate editions would have less features and may hit the Indian market in the first quarter of the next year.” A stripped-down version would help Volvo reduce the prices of its cars and help compete with much larger German rivals BMW, Mercedes and Audi.
BMW had, in the past, introduced a cheaper variant of its 3-series sedan to attract more customers. The 3-series sedan is the largest selling BMW car in India. The company sold 2381 units of the 3-series sedan in the last financial year. The sedan accounted for over a third of the total sales for the company in India in 2010-11.
Currently, Volvo Cars imports and sells luxury sedans S60 and S80 and premium sports utility vehicles (SUVs) XC60 and XC90 in the country. Volvo cars in India are priced between Rs 27 lakh and Rs 52 lakh (ex-showroom)
The company has no plans to set up a manufacturing unit in India in “the foreseeable future”. “In the segments in which we have products, our pricing is aggressive and comparable to competition. We are not looking at setting up an assembly unit in the near future”, said Ernberg. The company’s scale of operations in India is currently small. Volvo sold 130 units last year and expects to triple its sales to 400-500 units this year. It sells its four models through seven sales outlets in New Delhi, Mumbai, Chandigarh, Coimbatore, Hyderabad, Kochi and Pune.
The luxury car market in India stood at around 15,000 units in 2010. The segment has been posting strong growth numbers and is projected to increase by 40 per cent to touch 21,000 units this year. BMW sold 7,079 units in the last financial year, compared with 6,753 units sold by Mercedes Benz and 3,982 units sold by Volkswagen Audi. Volvo Cars is owned by Chinese automaker Zhejiang Geely Holding Group Co, which bought the company from Ford Motor Co last year.


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