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Last Updated : Feb 15, 2019 05:34 PM IST | Source:

Credit tightening, elections may restrict luxury car growth in 2019: Volvo India MD

Volvo will be three new plug-in hybrid due to launch in three years

Swaraj Baggonkar @swarajsb

Swedish luxury car brand Volvo recorded a 30 percent growth in 2018, the best in its peer group. However, replicating the performance in 2019 may not be easy, said Charles Frump, Managing Director, Volvo Cars India.

There will nevertheless be no slowdown in new launches with three new plug-in hybrids slated to hit the market in three years, Frump said in an interview with Moneycontrol. 


Q: 2018 was a very good year for Volvo with a growth of 30 percent. How do you see 2019?

A: Looking back at 2018, of course, it was very gratifying to see the results. There were a lot of headwinds – the aftermath of GST, credit tightening – the industry was very tough in 2018. The product drove success for us in addition to opening several dealerships. I do see 2019 being a very tough year for the luxury car industry and it is unlikely to grow. We will be happy to perform the level we are at in 2019.

Q: Volvo sold 2,638 units in 2018. Do you think you can hit 3,000 in sales in 2019? General elections are also round the corner.

A: It is hard to say at the moment. If we are able to sell the number of cars we sold this year we will be happy with that. There is a high level of uncertainty and our customers respond to that. They want to see what is going to happen and uncertainty is never good for the business.

Q: You don’t see any taxes going down?

A: Just prior to the Budget was the reduction in import duty for electric vehicles. When this happened I immediately contacted Sweden. Because this is a possible game-changer for us from a business case perspective. This is something we are very grateful and happy to see because this can speed up the implementation of bringing EVs to India.

Q: Volvo has promised the launch of four plug-in hybrid vehicles in three years. Could you please share more details? 

A: The biggest step for us is that we are going to be the first manufacturer to build plug-in hybrid electric vehicles (PHEV) in India. That will be followed by a series of PHEVs. At the moment though, there is not any government support for it. And Volvo believes the road to full electrification goes through plug-in hybrids. So we are doing all we can to build awareness about hybrids.

Q: So, is the S60 sedan coming next year?

A: Yes, S60 petrol and PHEV will be coming to India next year. This is a very big global launch alongside the V60 in some markets not so much for India. The S60 will be launched in 2020 in India.

Q: Has credit availability been a concern in recent months?

A: Absolutely. The tightening of credit has led to some disruption in our industry especially in Delhi where it is very tight. Banks, perhaps rightly so, have tightened credit lines. We just need a little time to adjust to that. It is an industrywide concern with all our dealers.

Q: You added six dealerships last year. How many would be added this year?

A: We won’t grow as fast. With the opening of the 25th dealership, we have reached a critical mass. About 2-3 years ago Volvo had dealerships only in 2-3 key cities. Now, I am very confident that if a customer is interested in buying a Volvo they will be able to do so conveniently in their town. I see some dealership additions in Tier II cities. I also see us adding service capacity, a number of them being standalone facilities.
First Published on Feb 13, 2019 07:11 pm
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