Volvo President Anne Belec: "The majority probably doesn't know where their cars are built."
"The majority probably doesn't know where their cars are built, and we're not sure they care. But some customers are more sensitive than others," said Anne Belec, president of Volvo Cars of North America Inc., last month at the New York auto show.
Executives said Volvo has sufficient plant capacity for its current volume. However, Volvo's volume objectives of 600,000 units by the end of the decade will require additional capacity. Volvo sold 456,224 units globally in 2004.
The Ford Five Hundred and Freestyle both use Volvo S60 underpinnings. Both are made in Chicago. Ford also is planning to assemble Volvo-based Lincolns in Atlanta.
Hans-Olov Olsson, CEO of Volvo Car Corp., said currency exchange rates are a challenge but will not determine where the next assembly plant will be built.
"Moving a Volvo car onto a Ford assembly line doesn't solve the issue," Olsson said. "You bring your cost and income base with you. Assembly cost is just a fraction of the total cost, and the labor cost is becoming smaller and smaller.
Volvo's Swedish and Belgian plants combined can build about 500,000 vehicles running three shifts and could squeeze out another 50,000 units. Volvo also builds in low volumes in Finland and has knockdown plants in Malaysia and South Africa.
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