'We aim at expanding the product portfolio in India'

Written by Malabika Sarkar | Malabika Sarkar | Updated: May 16 2009, 07:15am hrs
Volvo Car India (VCI), a subsidiary of Ford group company Volvo Car Corporation, expects the demand for luxury and super luxury cars to double in India and wants to be part of that growth. The luxury carmaker, which was founded in 1927 in Gothenburg, Sweden, sells its cars in about 100 countries. Paul de Voijs, managing director, Volvo Car India, told FEs Malabika Sarkar that the company hopes to strengthen its foothold in the country by expanding its dealerships and by bringing new models from its global portfolio. Excerpts from the interview:

As a brand, a Mercedes or a BMW has a much higher prestige value than a Volvo, which is identified more with safety and less with luxury. What are you doing to change the perception and move to the big league in India

Firstly, our pricing is very competitive; the V8 engine is one of the most competitive V8s available in India. We believe in providing luxury at the right price. We are looking at building and spreading awareness about the brand image and its core values among its target audience. We are also establishing an efficient infrastructure with an experienced dealer network. At present we have five dealerships as we wanted to start with a limited number of dealers being new in this country. We have an energetic product linethe first flagship models being the sedan S80 and the crossover XC90. We are also keen on bringing in our international properties into India showcasing our commitment to this market. In 2008 Kochi witnessed the Volvo Ocean Race, the biggest yacht race across the world. In 2009, we intend to bring in our popular golf tournament Volvo Masters Amateur.

By 2009, you were planning to open 14 new dealerships in the country. How many have been opened and how many are in the pipeline

Our aim is to have a dozen dealerships in India by the end of 2009. Currently we have five dealerships (New Delhi, Mumbai, Chandigarh, Kochi and Hyderabad) and going forward in 2009, we plan to expand our footprint and increase our dealer base to about nine in cities like Pune, Chennai, Bangalore, Ahmedabad, Jaipur and Kolkata.

Volvo imports its vehicles through dealerships, and the import duty, wily nily, adds to the final price. If you are looking at India for the long term, you have to set up a manufacturing facility here, right

Yes, import duties add to the price of the cars. On the other hand, if you have a manufacturing facility in the country there are several fixed and variable costs attached to the same. Additionally, there are some domestic duties levied on the production of cars locally. Therefore there is marginal difference in the final price of the car sold at the dealerships. If you compare the price of a Volvo car in India to any of the other luxury brand, you will find our pricing to be competitive. Currently we are looking at strengthening our foothold in the country by way of opening several dealerships across metros and mini metros. There are no plans for setting up a manufacturing plant in India at present.

How long would it take you to develop India as an important base

We consider India as an important market with immense potential in the luxury car segment. Our aim in the first year of operations was to establish our brand name and make the consumers familiar with our values. Our management team is also working at expanding the product portfolio in India with the launch of Volvo XC60. We are confident that 2009 will be a positive year for Volvo in India.