2014 AUTOMOTIVE NEWS WORLD CONGRESS

Volvo could bring China-built vehicles to U.S. 'fairly quickly'

Samuelsson: Volvo is in a unique position to use China as a manufacturing and export base.
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DETROIT -- Hakan Samuelsson, CEO of Volvo Car Corp., said Volvos produced in China could be exported to the United States "fairly quickly."

Speaking at the Automotive News World Congress, Samuelsson, 62, would not give a target date. But he said Volvo is in a unique position to use China as a manufacturing and export base because it is owned by China's Zhejiang Geely Holding Group, which purchased Volvo from Ford Motor Co. in 2010.

Volvo already produces the S60 compact sedan in China in its first factory there, he said.

Samuelsson said he doesn't expect consumers to react negatively to the notion of a Volvo produced in China. U.S. consumers, he said, already are accustomed to sophisticated products such as smartphones coming from Chinese factories.

At last week's Detroit auto show, Samuelsson said the automaker could begin to export Chinese-built vehicles to the U.S. in an effort to insulate the company from dollar-Euro currency swings and rely on the more stable relationship of the dollar to the yuan.

China production boost

The V40 hatchback replacement also will be produced in China -- and possibly in Europe -- when it is replaced in the next few years using a new platform being developed jointly with Geely.

That platform, called the compact modular architecture, will underpin small cars for Volvo and Geely, Samuelsson said.

U.S. Volvo dealers are lobbying for the V40 and a crossover off the same platform. The smaller models would give Volvo an entry in a premium segment that has proved very successful for German brands.

By developing the V40 with Geely, "We can share component and transmissions and axles and lower cost," Samuelsson said.

"It is an example of how we can use an open and honest connection with China. It is one company. We are the only ones that can do that in China."

Samuelsson said joint development and production of a small car with Geely is no different from the numerous other partnerships formed between other automotive companies.

And exporting a Chinese-made vehicle "will happen fairly quickly in the Volvo group, but it has to be a process that you discuss with your dealers and sales group," he said. "We are the only ones who can think of using the factories for export, which we will be doing."

Volvo has an assembly plant in the southwest Chinese city of Chengdu. An engine plant in the north Chinese city of Zhangjiakou began production late last year, and a second vehicle assembly plant in the northeast of China will begin making vehicles this year.

You can reach Diana T. Kurylko at dkurylko@crain.com. -- Follow Diana on Twitter

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