Volvo wants to export China-built S60L and XC90 to US and Russia next year

Article by Christian A., on June 18, 2014

Volvo is intending to commence exporting China-built cars to the United States and Russia as early as 2015, a senior Volvo executive told Reuters. With support from Chinese owner Zhejiang Geely Holding Group, Volvo would commence shipping the S60L -- a long-wheel-based version of the S60 -- to the US and the XC90 SUV to Russia as soon as end of 2015.

A site in Chengdu started building the S60L sedan late 2013, and the second site in Daqing is ramping up output of the XC90. The executive said Volvo will eventually export around 10,000 S60Ls and a few thousand XC90s annually, noting that the carmaker believes it could minimize foreign exchange risks by adding China as a production base, despite worries about the quality of China-built products.

The executive said that the US dollar and the Chinese yuan have the “best relationship,” which is more stable than the euro and the dollar. David Ibison, Volvo's global head of media relations, has confirmed plans to start exporting from China, but said that the timing and target markets had yet to be determined.

Volvo chief executive Hakan Samuelsson remarked to Automotive News World Congress in January that vehicles build in China will be shipped to the US "fairly quickly."

Volvo plans to employ two assembly sites in China to export to the US, Russia and possibly other markets like Southeast Asia. The move would make Volvo as the first major carmaker to sell a Chinese-made light vehicle in the US.

Other Chinese companies are observing Geely's strategy for Volvo, which if successful, could become a pattern for their entry into major markets like the US. [source: Reuters]

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