Volvo Cars to start vehicle assembly in India

Volvo announces local assembly for India XC90 to be first model

Volvo Auto India Managing Director Tom von Bonsdorff said the commencement of local assembly unit is a sign of the company's strong commitment in India.

"While the Indian luxury market is still relatively small, it is estimated to grow rapidly in the coming years".

Mumbai: Swedish luxury vehicle company Volvo Auto India Pvt.

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 United States giant Ford and subsequently acquired by China's Geely Group in 2010. In India Volvo Cars has seen a robust 32 per cent growth in sales volumes over the past two years. Additional models slated for local assembly will be announced at a later stage. While the company is starting with local assembly right now, further localisation will depend on how quickly it adds on the local sales numbers. Year-on-year sales growth in the first four months of 2017 was more than 35 percent.

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 government.

The first Volvo model, XC90 premium SUV, will be assembled this year in alliance with Volvo Group's (trucks and buses) existing infrastructure facility near Bengaluru, Karnataka this year.

And it aims to double its market share in premium or luxury cars, which is now "close to five percent", it said.

Volvo Auto India, the subsidiary of Volvo Cars, established presence in 2007 and has, since then, been selling cars under the CBU import route.

Volvo, the Swedish automaker of luxury cars, has now announced that it will commence local assembly operation in the Indian vehicle market, starting this year itself.

Hate it or love it, Tesla has managed to create huge demand for electric cars and this is something which other carmakers are pleased about. It expects sales to advance 25% to 2,000 units this year over the year-ago period. The contract manufacturing keeps investments in the assembly operations low and allows the company to be more aggressive in terms of margins and profitability in the Indian market. "It's an arms length partnership in the Bengaluru plant", said Samuelsson.

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