Volvo’s global sales down 1.3% in May 2015 as it ramps up XC90 output

Article by Andrew Christian, on June 5, 2015

Volvo experienced a 1.3% drop in global sales with only 39,919 vehicles sold in May 2015 because the first deliveries of the new XC90 failed to fully compensate for higher volumes of the old model sold in May 2014. In Sweden last month, Volvo’s sales fell by 4%. However, it reported an 8.6% increase in the rest of Western Europe.

The automaker’s sales in China decreased by 2.2% while sales in the U.S. fell by 0.2%. Sales in what Volvo refers to as “other markets” had the steepest drop of 18.8%. However, the brand revealed that it got over 36,000 pre-orders for the new XC90, which have not been covered in the most recent sales data.

Volvo has a lot depending on the XC90 as it is expected to double the worldwide annual sales to 800,000 units by 2020. It’s expected to be competitive in a premium market that’s ruled by German brands. Four years ago, Zhejiang Geely bought Volvo from Ford Motor. The XC90 is the first fully new car built while under Geely’s ownership.

This SUV kickstarts the revamp of Volvo’s entire product lineup to models that is more upmarket. According to Volvo spokesman Stefan Elfstrom, the primary reason for the decline in sales was because of the product cycle as it had only newly started deliveries of its new XC90 vehicle. Elfstrom said that last year, the first XC90 generation had “meaningful sales” but it had only begun shipping the new model.

To increase production, a third shift was added at Volvo’s factory in Gothenburg, Sweden. Sales of the XC90 in China and the U.S. will start next month. From the start of the year through May, the brand’s global sales declined by 0.1% to 185,764 units.

Alain Visser, Senior Vice President Marketing, Sales and Customer Service at Volvo Cars, said that he is glad to witness the positive feedback from buyers and the media towards its new products. He added that customers will soon get the all-new Volvo XC90 and that the new Volvo V60 Cross Country will further strengthen its XC lineup.

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