Volvo Cars of North America Inc. expects to sell a record 145,000 units this year, about 19 percent higher than record 1999 sales, en route to 200,000 units a year by the middle of the decade.
Volvo is on a crusade for exclusive dealerships, and it is offering incentives up to $2,500 per car to back it up, plus a series of new products.
In return, Volvo is demanding exclusivity; high customer satisfaction scores; Internet marketing in cooperation with Volvo; training and factory-recommended displays to introduce the new V70 station wagon later this year; and participation in programs to support residual values and used-car sales.
'We are in an environment where we have to have priorities, and the first priority is Volvo,' President Hans-Olov Olsson told dealers during the make meeting at the NADA convention.
He told dealers to leave it up to him to worry about Volvo's role in Ford Motor Co.'s Premier Automotive Group, along with Lincoln, Mercury, Jaguar and Aston Martin. 'PAG, that is second (priority). Then, looking for synergies with Jaguar and Lincoln. No. 3 is Ford and looking for synergies there,' Olsson said.
In December, Olsson confirmed Ford is considering moving Volvo's U.S. headquarters from Rockleigh, N.J., to California, to be closer to Lincoln Mercury headquarters in Irvine, Calif.
Meanwhile, Mark LaNeve, marketing vice president, said the new dealer incentives take effect in April, when Volvo replaces the V70. The new program is called '200,000 Growth Investment,' a reference to Volvo's long-term goal of 200,000 U.S. annual sales, La'Neve said after the make meeting.
Volume also should get a boost from selling off the 2000 model V70. Richard Snijders, vice president of product planning, said options such as wood trim and leather that normally retail for around $4,000 will be offered for around $900 at the end of the 2000 model year.
'I think there will be a lot of demand for the old car,' said Massachusetts dealer Ray Ciccolo, who owns Boston Volvo Village.
Ciccolo and other dealers said the payoff from Volvo's new dealer incentives will be 'very, very similar' to Volvo's old Partnership for Excellence Program. That was a maximum of about $2,500 per car.
Without fanfare, Volvo settled a lawsuit in December where two dealers had sued Volvo over its threats to terminate dealers who were dualed with other brands. In the case of dealer Tom Nemet in Jamaica, Queens, Volvo officials confirmed that Nemet was allowed to keep the franchise until he dies or retires, but he may not sell it. LaNeve said after the meeting that dealers did not ask about the Nemet case.