Swedish luxury car maker, Volvo has announced that car maker is setting up an assembly plant in India near Bengaluru. The new plant will be operational by the end of this year. The first car that will be assembled in India will be the flagship SUV, XC90.
After the first model, Volvo will also roll out other products based on the Volvo’s SPA modular vehicle architecture. Volvo says that the move was inevitable and it has finally happened. Volvo currently imports completely built units (CBUs) from Europe. The assembly of vehicles will take place through the strategic alliance with Volvo Group India – a separate company of the Volvo global group that has been manufacturing trucks and buses in India.
“In establishing its assembly operations, Volvo Cars is working together with Volvo Group India – the truck, bus, construction equipment and Penta engines manufacturer, and will make use of Volvo Group India’s existing infrastructure and production licenses near Bengaluru,” the company said in a statement without divulging details of the investment.
Volvo saw double-digit growth in the Indian market for last two fiscals and finally, the brand will start assembly process in the Indian market. Volvo has seen a growth of over 32% in last two years and the company is planning to sell 2,000 units per year in India soon. The local assembly will boost the local job prospectives and will also slash the price of the cars by a good margin.
Currently, Indian line-up of Volvo only has two cars on SPA platform – XC 90 and S90. In future, Volvo will offer other cars like V90, XC60 and S90 in India, which are also based on the same platform. But no further news has been given about the assembly of the other models in India right now.
Håkan Samuelsson, president and CEO of Volvo Cars, said: “Starting vehicle assembly in India is an important step for Volvo Cars as we aim to grow our sales in this fast-growing market and double our market share in the luxury segment in coming years.“
Tom von Bonsdorff, Volvo Auto India managing director called the announcement “a sign of the company’s strong commitment in India”.
“Backed by a robust sales growth, expanding the network and an array of new product launches the local assembly will provide us with an impetus to garner a sizeable segment share in the medium to long term. Each locally assembled Volvo Car will have same International standards as anywhere else in the world. With our continued efforts we are sure to build a strong foundation for our business in India,” Bonsdorff said in a statement.