Volvo cars maybe on the way to really crack open the Chinese market
Sunday, 10 November 2013
That Volvocars has had it tough in the Chinese market is nothing new
according to past news reports but there seem to be a strategy on the
way for the Chinese owned Swedish brand to finally break into the
Chinese auto market and really get big.
Media reports in Sweden hold that the Chinese politicians and officials
are being urged in a secret negotiation to adopt Volvo cars as their
official cars over Audi. If that happens then Volvo will soon overtake
the Germans in the Chinese market.
According to the reports negotiations has completed that will make
Volvo and Hongqi car manufacturer to supply all cars that cost more
than 180,000 yuan (about the same in Swedish Krona) to some of China's
China is the world’s largest car market at this moment given its
population, but domestic brands account for only 0.2 percent of the
luxury segment - cars that cost more than 200,000 yuan, reports Swedish
business daily, Dagens Industri.
Reports hold that the new leadership of the country wants that to
change. Therefore there are calls from as high up as the Chinese
President, Xi Jinping that the country's authorities should choose
domestic over foreign cars. Chinese authorities spend something like
Skr80 billion per year on luxury brands.
Industry and Information Ministry has also made a draft of a car
catalogue that lists what cars the authorities should buy and the
Swedish media sources say the catalogue is made up of only Chinese car
Volvocar corporation was bought in 2010 by Chinese Geely whose owner Li
Shufu was rumoured to have good contacts with the high places in the
country's power pyramid.
According to Forbes magazine subsidies such as tax breaks and cheap
land accounted for 65 percent of Geely's net profit last year, reports
Swedish media sources.
Talking about competition and open markets in China…
By Scancomark.com Team
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