Volvo's goal: Turn around U.S. sales
New marketing, engines, vehicles are part of plan
Editor's note: An earlier version of this story incorrectly said Volvo is introducing six-cylinder engines. Volvo is focusing on four-cylinder engines.
SUMMIT, N.J. -- Volvo will reverse its downward sales trend in the second half of the year as new four-cylinder engines and connectivity features become widely available, said Tony Nicolosi, CEO of Volvo Cars of North America.
Volvo will increase marketing to build awareness of the brand and its new features. New TV commercials air next month.
But Hakan Samuelsson, CEO of Volvo Car Corp., says it is still troublesome that Volvo sales in the United States haven't kept up with the growing market. Volvo's U.S. sales fell 10 percent in the first five months to 23,347 units in a market that grew 5 percent. He said Volvo has committed a "considerable increase" in marketing to move sales.
Samuelsson also said that Volvo has not made a final decision on whether to sell a China-built long-wheelbase version of the S60 sedan in the United States. News reports last week said that Volvo, which is owned by China's Zhejiang Geely Holding Group, plans to export the S60L to the United States and Russia as early as next year.
Samuelsson said reasons for importing vehicles from China would include currency advantages and low cost of labor.
Top U.S. and Swedish Volvo executives were here for the opening of a new dealership for family-owned Smythe Volvo, which tripled the size of its store.
Samuelsson: Sales troubling
Waiting for XC90
Samuelsson said part of Volvo's problem is that new vehicles won't arrive until the redesigned XC90 crossover goes on sale in the United States in the first quarter.
"We have to invest more in media communication," he said. "We have to tell our customers that we are committed to revitalizing the brand."
Volvo's new marketing message is that "we deliver a premium car but designed around you," said Samuelsson. "It is not just bundling a lot of technology together to have a lot of gadgets in the car. It is important to deliver smart functionality and connectivity."
Nicolosi said the new four-cylinder 2.0-liter engines debuted this month in 20151/2 model year vehicles and have stop-start and remote start features. New navigation systems will be available on nearly every model.
Volvo also has made its On Call feature standard rather than requiring a paid subscription. On Call can be used remotely via mobile app to provide information such as the car's location and needed repairs and provide access to the dashboard and door controls. It also can be used for emergency 24/7 service.
Volvo's Sensus Connect system also is standard beginning with 20151/2 vehicles. The app allows Internet access using 3G mobile broadband and can create a Wi-Fi hot spot. It offers apps including Yelp, Wikipedia, iHeartRadio, Pandora, TuneIn and park and pay. Control is integrated with voice, steering wheel and displays in the car.
"We have tremendous features, but we have to be bolder and louder," Nicolosi said.
Samuelsson said the transition is challenging, but "in the next three years, we will renew everything, six cars -- and have a lot of variants."
"It will be in the first time in the history of the company that we'll have everything released in three years and fully synchronized and modernized."
The XC90 replacement will be the first car built on Volvo's new modular SPA platform, which will eventually be used for all models except the V40 compact. The replacement V40 is being developed on a different platform by Geely.
The XC90 will be unveiled in Sweden in August. Volvo has been trickling out information, including the car's new center-mounted touchscreen that will use Apple's CarPlay communications system for most infotainment, communications and climate setting rather than buttons. It would be operated with swipe motions similar to those used with the Apple iPad and iPhone.
Kevin Flanagan, one of the owners of Smythe Volvo, said he has seen the new XC90 and other redesigned cars. He spent $5.5 million on the new store because "I genuinely believe in these guys."
Smythe Volvo has a separate area for certified cars, a window with a view into the service area "and minimalistic and simple Scandinavian design."
Flanagan served on the building committee of Volvo's dealer council. "I visited everybody," he said about the competition. "They all have an almost over-the-top techy finish. This is a very comfortable place to come to with a human touch."
You can reach Diana T. Kurylko at firstname.lastname@example.org. -- Follow Diana on