2002 was characterised by significantly tougher competition, which affected Volvo Cars and other automakers alike. Despite a drop in total sales, Volvo Cars nonetheless succeeded in securing additional market shares on several vital European markets. All told, the company increased its market shares in the EU and EFTA countries. Demand for the new Volvo XC90 has been outstanding and the production rate for the current year will be upgraded from 50,000 to 65,000 cars annually. Volvo Cars sold a total of 406,695 cars in 2002, corresponding to a reduction of 1.4 per cent compared with the year before.
The Volvo Car Corporation did not manage to live up to its set sales targets for 2002. In the USA, the company lost both market shares and outright sales compared with 2001. The events of 11 September prompted a widespread price war in the USA involving generous discounts to customers. Volvo Cars chose a different path, focusing instead on profitability instead of short-term price reductions. The company chose to withdraw from unprofitable sales outlets such as car rental agencies, a move that has had a negative impact on overall US sales volumes.
The total number of cars registered in the USA dropped by 4 % in 2002 compared with the previous year. However, registrations of light trucks - including the SUV segment - remained unchanged from the year before. Volvo's sales totalled 111,062 cars, corresponding to a reduction of 11.7 per cent compared with 2001.
Volvo's first SUV, the Volvo XC90, has received a very enthusiastic welcome the world over, in particular in the USA where the reception has been particularly enthusiastic. The string of successes continued at the Detroit Motor Show, where the Volvo XC90 was named North American Truck of the Year - the most prestigious award on what is in effect the SUV's home ground. Volvo plans to sell just over 45,000 XC90s on the American market in 2003.
Sweden follows the vital US market as Volvo Cars' second-most important market. A difficult initial half-year, during which the market share was down to 18 % after the first five months, was transformed into an upbeat second half with sales that totalled 48,675 cars and a market share of 19.8 per cent by year's end.
In Europe, Volvo Cars increased its sales by 2.4 % in 2002 compared with the previous year. In Great Britain, the Netherlands and Belgium, sales dropped compared with 2001 levels.
At the same time, Volvo increased its sales and market shares in Germany, Italy, Spain and France. In Europe as a whole, Volvo did better than its main competitors, among them Audi, BMW, Mercedes, Saab and Volkswagen.
Much of the success in Europe stems from the fact that Volvo now has its very own highly regarded diesel engine in the market's key segment. The proportion of diesel-car sales is rising significantly in Western Europe, increasing last year to 40 per cent as opposed to 36 per cent the year before.
Several small markets recorded huge increases in sales in 2002 compared with the previous year. Denmark (+157 per cent), Mexico (+87 per cent), China (+75 per cent), the United Arab Emirates (+66 per cent), South Africa (+64 per cent) and Poland (+33 per cent) were some of the countries showing the biggest sales increases.
Among the various models, the Volvo S60 (107,463 cars) and Volvo V70 (94,729) remain the biggest sellers. Both models increased their sales by 10.7 per cent during last year. The Volvo S60 is a major success, with sales in the region of 100,000 cars for the third consecutive year.
New products and launches
2002 saw the Volvo S60 R and Volvo V70 R unveiled at the Paris motor show. Volvo Cars has had high-performance cars in the past, such as the Volvo 850 T and V70 R. The new cars take a further step by offering higher performance and greater driving pleasure than ever before. They are powered by 300 hp engines and they feature a unique FOUR-C suspension system that adjusts to suit current driving conditions - from maximum comfort to sporty thrust. The Volvo S60 R and Volvo V70 R enjoyed an excellent reception by the international press during the autumn's test driving sessions. Both versions will be available to order in summer 2003.
Number of sold cars per market*
Turist & Diplomat sales
* Sold cars, delivered to end-customers
Number of cars* per model
Volvo Cross Country
Volvo C70 Convertible
Volvo C70 Coupé
Volvo Cars, top 10 markets
Total market 2002
Volvo's share of
* Source ACEA apart from USA and Japan
Number of employees 31 Dec. 2002
Market companies and assembly plants*
* This figure also includes Volvo Cars employees in the Born factory
Production* per factory and model 2002
*Excl pre-production cars