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Geely Wants Volvo To Compete With BMW And Mercedes-Benz

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2011 Volvo S60

2011 Volvo S60

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We’ve heard it all before but rarely have we seen it executed successfully; mid-tier luxury brands attempting to move upmarket and compete with tier 1 brands luxury brands such as Mercedes-Benz and BMW. Acura is one such company that has often stated reaching tier 1 status as its primary goal but has still failed to deliver.

Now Volvo’s new owner Geely hopes to do the same with the Swedish automaker, as revealed by founder and chairman Li Shufu. He hopes to boost Volvo’s global reputation, especially in China, and step up research and development efforts in order to maximize sales bring Volvo back into profitability.

"We want to make more high-level cars that compete with the S-Class of Mercedes-Benz and the 7-Series of BMW. We need products to compete in that segment," Shufu told reporters from Automotive News.

What Shufu hasn’t revealed yet is how Volvo, which lost more than $653 million last year, will be able to build new models to take on the flagship sedans from its German rivals. Volvo first needs to focus on selling more cars; it will need to sell at least 380,000 cars if it hopes to break even. Last year Volvo’s sales totaled 335,000 units.

[Automotive News, sub req’d]

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Comments (4)
  1. Hahahaha! And this article is my official laugh of the day!
     
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  2. This reminds me of the Volkswagen Phaeton attempt at catching up to Mercedes and BMW.
     
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  3. Yes, someone needs to explain to Geely that Volvo's brand equity is not at BMW and Mercedes levels in most segments. Walk before you try to run.
     
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  4. I disagree with the first sentence in the article. I'd say Lexus is an example of a "mid-level" luxury brand that went on to compete with Mercedes and BMW. Likewise, Audi wasn't considered a serious rival to them until the '90s. Indeed, BMW was once the maker of lowly Isettas and the 600, a rival to VW. It takes time to build a brands image and reputation. That said, a Chinese owned Volvo competing with the S-Klasse and 7er sounds faintly ridiculous. Then again, that's what people were saying about Toyota in 1989.
     
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