Volvo Establishes China HQ In Shanghai

Headquarters Will Oversee Management And R&D At Attached Facility

Volvo is looking to rival Mercedes and Audi in China through localization and increased production

Volvo is looking to rival Mercedes and Audi in China through localization and increased production

Volvo China, acquired last year by the Hangzhou-based automaker Geely, has opened its new headquarters in Shanghai. Comprised of a management center that will serve the entire country as well as a new R&D facility, the opening of the new HQ was attended by Volvo CEO Stefan Jacoby, who has recently said he hopes to gain market share in the China market from dominant players like Audi and Mercedes-Benz. Instrumental to Jacoby’s strategy is the attached R&D facility, which will be focused primarily on localization and new technologies designed to help Volvo adapt to regional and local demand and tastes more quickly than its competitors.

Volvo is fighting to compete not only for better brand image and sales, but also for increased production. Currently, Volvo production in China is done through its joint venture Chang’an-Volvo, which had originally been set up under Ford’s direction and which China Car Times notes has a “very limited production capacity.” Now, under Geely’s control, Volvo has plans to build three new factories in China. The company hopes increased production better auto sales in 2011 could make this large-scale investment worthwhile. While this might not apply in Beijing, inland cities and China’s southeast could potentially prove fertile markets.

However, success all comes down to the cars, and whether Volvo can offer the same quality and features as the dominant German brands. Volvo has previously announced it will be launching its S60 in March, but not to be outdone, BMW’s elongated 3-Series, Audi’s A4L and A6L, and the Mercedes-Benz E-Class L are all set to hit the market this year as well.

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