Weekly News Review | 30 May 2016 | Automotive Purchasing and Supply Chain Automotive Purchasing and Supply Chain

Talking Point

Volvo at large with small car strategy

Last week, Volvo unveiled two beautiful concept cars that marked the beginning of the Swede’s small car strategy, breaking into the crowded premium compact segment. The ‘40.1’ crossover and ‘40.2’ sedan concepts will be based on Volvo’s ‘Compact Modular Architecture’, focused around smaller, more compact vehicles. This will help the Scandinavian brand move away from it’s mature image, aiming its sights towards its German counterparts and working its way back into the US, introducing production versions into the region by 2018. This is a breath of fresh air from Volvo, which will exploit the premium compact car segment in order to increase volumes and overall growth in the near future.

The concepts are uniquely designed and look excellent. I’ve always felt that Volvo could be doing so much more in the modern automotive market, despite their very successful XC90 SUV. With BMW starting to fall further behind Mercedes-Benz, the industry is screaming for a new alternative to the ‘typical’ German automobile. Volvo needs to pounce on this segment as quickly as possible. The days of ‘bigger is better’ are slowly crumbling under compact SUVs that provide the same comfort and overall experience of a full-sized 4X4 in a much smaller and more nimble frame.

The designers at Volvo have done well to fit these overstated models into the company’s product line up, still retaining the iconic Scandinavian look but with a youthful, confident style. You can definitely see Volvo following a similar path to that of Jaguar Land Rover, a strategy that has worked wonders for revamping the British heritage brand. Volvo can finally supply vehicles across multiple generations and start to expand globally, competing with rivals in a range of segments and regions.

Volvo has a tendency to make bold statements and commitments for the brand’s development, such as promising no serious accidents or deaths in any of its new cars by 2020. The company’s latest commitment concerns electrification, promising to sell over one million electric vehicles by 2025, including electrified versions of the 40 Series that will exceed 215 miles; something that will definitely need to be extended in updated models. Volvo seems to be throwing around a lot of promises recently, along with its brand relaunch, but can it finally reach the heights it deserves? I’m sure Geely’s investments exceeding $11 billion since acquiring Volvo in 2010 will provide a helping hand.

Alex Kreetzer

Alex Kreetzer - News Editor

Simon Duval Smith

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