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Business / Auto China

Volvo looks to increase sales volume of NEVs

By HAO YAN (China Daily) Updated: 2015-10-26 09:52

Volvo Cars announced its midterm target on Wednesday that new-energy vehicles would contribute 10 percent to its sales volume, and that it will tap the fully electric market in 2019.

The premium automaker is to develop a pure electric model based on the Compact Modular Architecture that is in joint research and development by Volvo Cars and Geely Automobiles. All of its future lineups will be available in plug-in hybrid electric versions.

Lars Danielson, CEO of Volvo Cars Asia-Pacific, said: "Electric mobility is the future trend. We have already been working on NEVs for nearly 40 years and launched the Europe's first plug-in hybrid models."

"Volvo Cars is conducting NEV research and development globally, and the Asia-Pacific research center, located in Shanghai, is part of that practice. Besides, we are now offering Chinese customers the locally produced S60L plug-in hybrid electric vehicle," he said.

The automaker, which has its headquarters in Sweden, does not have a "localization" concept as frequently used by international automakers, but conducts its R&D and production around the world. Research results are shared worldwide, and production is located globally according to demand, said Volvo Cars China R&D Vice-President Shen Feng.

While demand for combustion engine vehicles is waning, that for new-energy vehicles is picking up. However, 43 percent of potential NEV buyers in China listed government subsidies as important in their decision, as the price for NEVs is much higher than for similar gasoline cars, according to a report by Nielsen China, a leading market research company.

Danielson said the company is doing its part to make NEVs affordable for consumers, and retail prices will go down in the future as sales volume climbs.

He said: "The Volvo S60L PHEV, which started delivery in July, is the best selling premium PHEV in the country. In the past three months, we have seen it sell well, especially in Shanghai, as buyers in Shanghai are motivated by the subsidies."

The Volvo S60L PHEV, launched in the Chinese market in May, is listed in a national catalog of NEVs eligible for subsidies, and also in those of local governments. Thus, buyers are eligible for tens of thousands of yuan in subsidies from the country, as well as the city and district where the car is registered.

"Volvo also offers the imported XC90 T8 version to Chinese customers. It is the only 7-seater PHEV on the market," Danielson said.

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