Domestically Developed Volvo Must Be Urgently Needed to Make Home-made Certificates

Last week, Volvo released its "human-respected" brand strategy and launched its third National Brand Experience Day. This is Volvo’s official highest-profile launch event since Volvo China’s team debuted in February this year. At the event, the senior vice presidents of Volvo Global and the chairman of China's Shen Hui and other Volvo executives also intentionally or unintentionally introduced the status quo of their Chinese production base, that is, continue to wait for government approval. Obviously, Changan Ford's OEM production is not a permanent solution. Volvo needs urgently a real domestic "certification card." The official saying is that Volvo's domestic production is a nail, but what kind of qualifications will still be determined.

Beautiful transcript

According to the published data, since the delivery in August last year, Volvo has achieved profit for six consecutive quarters. In the first half of this year, Volvo Cars' global pre-tax profit exceeded 1.2 billion Swedish kronor (about 1.214 billion renminbi), an increase of 450 million Swedish kronor (about 455 million renminbi) in profits. Among them, the Chinese market sold more than 21,000 vehicles, an increase of 36% year-on-year, slightly higher than the overall increase in the domestic luxury car market, with a market share of 4.3%.

Such a beautiful transcript undoubtedly satisfies the requirement that Volvo be profitable and has continuous profitability after delivery. However, in the press release issued by Volvo, the company's production base was marked in particular by the body. “Chengdu and Daqing factories are waiting for government approval. Volvo Cars China plant construction will always adhere to a globally uniform manufacturing and quality system standard, which is crucial for the production of globally uniform automotive products.”

Shen Hui introduced that the preparatory work before the construction of the factories in Chengdu and Daqing had all been completed. The Shanghai R&D center was positioned to support localized R&D of products and to undertake part of Volvo's global research and development, such as the research and development of electric vehicles and small car engines. While Zhangjiakou Engine Factory, which is widely publicized by the outside world, Shen Hui has also admitted that there are plans to build an engine plant, but the specific place “seeing several” has not been finalized and is still in the stage of being reported for approval.

Only owed "grant card"

The reason why the production bases are all in the process of approval is that Volvo’s domestic qualifications are still in the approval process. Whether it is the status of a multinational company or a local company, Volvo is still discussing with related departments. Shen Hui said that there are several types of programs that can certainly pass the approval and may be approved after 2-3 months. Volvo’s massive brand promotion can almost be regarded as an early sign of the “grand card”.

Volvo may prefer to be domestically made as a local company. In an exclusive interview with reporters, Volvo executives also revealed this meaning: "Although Volvo is a company registered in Sweden, it is a Shanghai company above the Swedish company."

Jia Xinguang, an automotive analyst, believes that Volvo is unlikely to establish a domestic joint venture company in China as a foreign-funded enterprise. It is more biased towards being made domestically as a domestic-funded enterprise. This is more reasonable, and it is not necessary to “backdoor”. He believes that Volvo may be able to change its identity, for example, making it Volvo China instead of Volvo China. However, due to Volvo's special identity, there is no precedent to follow, so the approval process of the relevant departments will be somewhat difficult to grasp, but the "approval is definitely approved." This is exactly what the Volvo team hopes.