Bloomberg News

Volvo Cars to Offer Just 4-Cylinder Motors in Hybrid Push

March 04, 2014

Volvo Cars Chief Executive Officer Hakan Samuelsson

Volvo Cars Chief Executive Officer Hakan Samuelsson said, “Sometimes you have to make radical choices, but we’re not a bit nervous about it. The brand has to stand out a bit more.” Photographer: Daniel Acker/Bloomberg

Volvo Car Group will offer only four-cylinder engines as the Swedish manufacturer owned by China’s Zhejiang Geely Holding Group Co. (175) promotes hybrid systems to stand out from other upscale auto producers.

Customers who want more than the 190 horsepower generated by the standard combustion engines can order electric motors that give the vehicle as much as 400 horsepower, Volvo Cars Chief Executive Officer Hakan Samuelsson said in an interview today at the Geneva International Motor Show. The hybrid models will have four-wheel drive as the electric motors power the rear wheels while the conventional engines power the front.

“Sometimes you have to make radical choices, but we’re not a bit nervous about it,” Samuelsson said. “The brand has to stand out a bit more.”

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Volvo, which built a reputation around safety and reliability, is in the midst of an 11 billion-euro ($15 billion), four-year project to develop a range of new models in an effort to almost double sales to 800,000 vehicles by 2020. The Gothenburg-based carmaker is about one-fourth the size of luxury-auto sales leader Bayerische Motoren Werke AG.

A revamped XC90 sport-utility vehicle, Volvo’s first model developed since Geely bought the Swedish company from Ford Motor Co. (F:US) in 2010, will be presented later this year and sport a touch-screen display using Apple Inc. (AAPL:US)’s CarPlay communications system. The Swedish manufacturer unveiled a prototype wagon in Geneva that showcases the new technology.

Growth Forecast

Volvo Cars is forecasting sales this year will rise about 5 percent from last year’s 427,840 vehicles, propelled by a jump of more than 20 percent in China, Samuelsson said. After declines in Europe and the U.S. in 2013, deliveries should increase in line with those markets this year.

Global car-industry sales are expected to rise 3.8 percent this year, boosted by 11 percent growth in China, according to an estimate by market researcher IHS Automotive.

Volvo Cars expects to remain profitable this year after ending losses in 2013. To lower costs, the company is working with its Chinese parent on a small-car platform for models that will be available in three to four years, Samuelsson said.

To contact the reporter on this story: Chris Reiter in Geneva at creiter2@bloomberg.net

To contact the editors responsible for this story: Chad Thomas at cthomas16@bloomberg.net


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