March 22, 2006

Volvo to start production of S40 in China

Chongqing, China – The Volvo Car Corporation has announced it will build vehicles in China, with the new Volvo S40 produced at Volvo Cars’ partner Changan Ford’s production plant in Chongqing.

Volvo’s technical team has worked with purchasers from Changan Ford to select local suppliers for a number of parts, with the aim of meeting the Chinese government’s requirements for local production.

“Local production is the key to remain competitive in China,” said Fredrik Arp, President and CEO of Volvo Car Corporation. “We are facing a scenario where the import duty is levelling out on 25 per cent and our main competitors are already producing their volume models locally. A Volvo must be a Volvo car in all aspects, no matter where it is produced. After working with Changan Ford for over a year, we have ensured that their factory, cooperating with our own experts, will meet our high demands on the Volvo quality.”

Volvo is aiming for an annual production volume of approximately 10,000 units. In addition, seven new models will be introduced between 2006 and 2009; the C70 convertible, revealed in Frankfurt last year, will be launched in China within a year. Volvo is also planning to market the new C30 and S80 in the Chinese market. Volvo has had a representation office in Beijing since 1994 and now has representation in 45 cities, including showrooms and service facilities.

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