Today, Volvo Cars India has announced that the Swedish auto manufacturer will finally now be making cars in India, as it moves from being an importer of fully built cars to the local assembly of its models. The assembly unit will be located near Bangalore and will focus on models based on Volvo’s SPA modular vehicle architecture. The first Volvo to be assembled locally will be the XC90. The brand will announce other models that will be assembled locally later.
The plan is to achieve this through a strategic alliance with Volvo Group India – a separate company to the car business – that has already been making buses and trucks in the country.
“I am pleased that as of this year we will be able to start selling Volvos that are Made in India,” said Hakan Samuelsson, president and chief executive of Volvo Cars. “Starting vehicle assembly in India is an important step for Volvo Cars as we aim to grow our sales in this fast-growing market and double our market share in the premium segment in coming years.”
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.
While the Indian luxury market is still relatively small, it is forecast to grow rapidly in coming years. Volvo currently has a premium segment share of close to 5 percent and aims to double this by 2020. Volvo Cars in India have had a robust 32 percent growth in sales volumes in the past 2 years and the 2017 trend is as per our plan to achieve 2000 cars, this will give us a growth of 25 percent year-on-year.
Cover image attribute: XC90 2018, Volvo Cars Group | Global