Automotive News Europe - December 2017 - Talk from the Top Supplement - 38

AUTOMOTIVE NEWS EUROPE

TALK FROM THE TOP

Success streak
Volvo CEO predicts 4th straight year of record sales

olvo sold a record 534,332 vehicles
last year and it expects to do even
better once it closes the books on 2017.
CEO Hakan Samuelsson says the automaker will set a new all-time sales high
for a fourth consecutive year. He is
bullish because Volvo has debuted the
all-new XC40, which competes in the
fast-growing compact SUV segment,
and launched the second generation of
its best-selling XC60. He talked about
the effect he expects from Volvo's first
compact SUV and explained why Volvo
recently decided to make Polestar a
stand-alone brand for top-performing
electrified models to challenge Tesla
as well as BMW's i subbrand. The CEO
shared his thoughts in separate interviews with Automotive News Europe.
Will Volvo maintain its record-setting
sales and profit growth?
We will continue increasing our percentage of smaller cars [with the arrival of
the new XC40 compact SUV]. That, of
course, is a very important factor for better margins. In addition, we aim to have
a volume increase. We are ramping up
to see how much we can reach. Barring
any major unforeseen changes to the
market, we should be able to crank out
more cars than last year.
What is your target operating margin?
A company that sells 800,000 cars a
year [which Volvo aims to do by 2020]
should have 8 percent profitability. Another way of saying this is that we want
to be as good as anybody else [in the
premium sector].
What is the average age of your customers?
It's in the mid-40s.
Is that down from the past?
I would be very surprised if it has not
gone down rather drastically. When you
grow, you get younger customers.
Is the arrival of the XC40 compact
SUV an opportunity to reduce the average age even further?
Yes and no. Yes, because we want that
car to appeal to younger customers, but

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I would not prohibit any older people from
buying it. What is happening in the market is that a lot of older people want to
copy the younger ones. They want to look
young and dynamic. Therefore, I think we
will sell a lot of XC40s to older customers. There's nothing wrong with that.
Is this a trend?
We had a very interesting internal discussion about that. If you look at clothing, shoes, suits, whatever, it's older
people who buy this modern, fancy stuff
because they want to feel young.
When did you decide that Polestar
would become your high-performance electric brand?
Before we acquired it [in 2015]. We
bought it with this in mind. We have been
working in secret preparing for this. That's
why were able to show the first car this
autumn. We will redefine the brand to
move it from making gasoline cars for racing into a high-performance electric brand
focused on progressive performance rather than just horsepower.
What is progressive performance?
That means also offering the latest connectivity products, the latest infotainment products, and, of course, a very
elegant design. That's where we want to
take Polestar. It will be our leading star
into the future and into electrification.
Would you consider Polestar for your
first fully autonomous car?
Autonomous drive is all about safety so I
would say Volvo is the brand that will carry the safety niche. Autonomous drive is
very clearly connected to Volvo. It could
also be used in Polestar. We have to look
into that, but Volvo definitely. If you think
about electrification and performance,
they will be more related to Polestar.
Polestar competes in the World Touring Car Championship but after the
repositioning it seems that Formula E
would be a better fit. When will you
make the switch?
We cannot comment on this part of the
brand's repositioning, but we are definitely not going to race long term using

Meet the boss
❚ NAME: Hakan Samuelsson
❚ T
ITLE:

Volvo Cars President & CEO

❚ AGE: 66
❚ M
AIN CHALLENGE:

Boosting production at
Volvo's main plant in
Sweden to keep pace
with demand for the
XC90 and XC60 SUVs.

gasoline. We have contracts, but I think
that if we do something, it must support
the brand position of Polestar.
How will Polestar benefit from its ties
to Volvo?
We will utilize synergies within the Volvo
Car Group, which means Polestar will
not be a startup. That makes the brand
more credible because it will benefit
from Volvo's solid industrial expertise.
Until recently, the people working on

In Partnership with

2017

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