Volvo replaces CEO Jacoby to get China plan back on track
Board says Jacoby's health not a factor, wants new CEO Samuelsson to take Volvo to 'new phase'
STOCKHOLM -- Volvo today named Hakan Samuelsson, the former head of German truck maker MAN, as its new CEO.
Samuelsson, 61, replaces Stefan Jacoby, 54, who suffered a mild stroke last month. The move is effective immediately. The board's vice chairman said Jacoby's health was not the reason for the decision and the board wanted a new CEO to take the company "into a new phase."
The new CEO faces the task of turning around flagging sales and accelerating Volvo's push into the home market of its Chinese owner.
Li Shufu, chairman of Volvo's owner, Zhejiang Geely Holding Group, said in a statement: "I see big possibilities for Volvo Cars to improve profitability and increase the pace of growth, not least in China." He added that Samuelsson's experience would help toward these goals.
Samuelsson already holds a seat on Volvo's board. "My time on the board has provided me with insight in the Volvo brand and the company. My focus will be on execution and performance, to secure profitability and meet our sales objectives," he said in the same statement.
Volvo, bought from Ford Motor Co. by Zhejiang Geely for $1.8 billion in 2010, aims to spend about $11 billion to double total annual sales to 800,000 cars by 2020 and boost China sales to 200,000 units, from only 47,000 last year.
The target is an ambitious one. The business made a net loss in the first half of 2012 and has faced tough European markets and a slowing Chinese economy.
"We have to get the China growth plan back on track," Samuelsson told a news conference after his appointment, which was decided at a board meeting on Thursday.
Samuelsson will focus on 'execution and performance.'
Samuelsson was CEO of MAN between 2005 and 2009 and has been an independent member of Volvo's board since 2010. A Swedish national, he started his career at truck maker Scania in 1977 after studying mechanical engineering.
Shufu praised Jacoby for his "valuable and strong contribution" in developing a new strategy and taking Volvo through the first two years following its acquisition by Geely. Volvo's board and Jacoby reached an "amicable agreement," according to the statement.
Chief Financial Officer Jan Gurander has been serving as acting top executive in the interim.
A 'new phase'
At a press conference to present Samuelsson, Volvo Vice Chairman Hans-Olov Olsson denied there was any conflict behind Jacoby's ousting and said that the change was necessary to put the strategy back on track to boost profitability and bolster sales in China.
"We want to succeed with Volvo. The board's responsibility is to take action. The competition does not do us any favors," Olsson said, adding that Jacoby's illness was not the reason for the decision to replace him.
"Stefan's health situation has nothing to do with this," Olsson said at the press conference. "The board made the decision that it needs a new CEO to take the company into a new phase."
Jacoby joined Volvo as CEO in August 2010 after Geely's acquisition of the company. A German national, he was recruited from his position as head of Volkswagen's U.S. operations.
Jacoby suffered a mild stroke in mid-September, limiting the mobility in his right arm and leg. He has been on medical leave since then, though Volvo had said that he was making progress toward a goal of returning to work soon.
Jacoby increased Volvo's focus on the Chinese market, initiating the construction of two car factories and one engine plant in the world's biggest auto market.
Volvo plans to nearly double deliveries to 800,000 vehicles by 2020 from 449,255 last year, but the company has cut production this year amid a market slump in Europe.
Reuters and Bloomberg contributed to this report.
PRESS RELEASE: Volvo Car Group appoints new President and CEO
The Board of Directors of Volvo Car Group has appointed Håkan Samuelsson, currently Board member, as new President & CEO effective immediately. Stefan Jacoby will leave Volvo Car Group* after an amicable agreement with the Board of Directors.
"I see major opportunities for Volvo Cars to improve profitability, and accelerate our growth plan in China specifically. I am convinced that Håkan Samuelsson's thorough experience and leadership will help us increase performance," says Li Shufu, majority shareholder and Chairman of the Board.
He continues: "We have a strong strategy and transformation plan in place which we will now execute. I would like to thank Stefan Jacoby for his valuable and strong contribution developing the strategy and taking the company through the first two years following the acquisition of the Volvo Car Group by Zhejiang Geely Holding," says Li Shufu.
Håkan Samuelsson has 35 years of experience from leading positions in the automotive industry, most recently as Chairman & CEO of MAN SE between 2005 and 2009. Since 2010 he is an independent member of the Board of Directors of Volvo Car Group.
"My time on the Board has provided me with insight in the Volvo brand and the company. My focus will be on execution and performance, to secure profitability and meet our sales objectives. No other business is as demanding, complex and full of challenges as the automotive industry. I look forward to leading Volvo Car Group in the most exciting period of its history," says Håkan Samuelsson."
*and consequently the Board of Directors