Volvo, Ford join hands in India

Volvo will cater to the high-end mkt, while Ford will feed the mid-size segment.

Europe's top-end car maker Volvo is planning an onslaught on the Indian market on the back of Ford India Ltd. Ford India's parent, the US-based Ford Motor, owns Volvo's car business.

The Indian subsidiaries of the two companies are planning a joint strategy under which Volvo will cater to the high-end market, while Ford will feed the mid-size segment, as it did with the Ikon earlier and does now with the Fiesta.

"Future launches in India could be a part of our global synergy with Ford Motor," Volvo Car India Managing Director Paul de Voijs told Business Standard.

He indicated that the two companies would work on a common platform to launch their cars in the country. "We could bring in vehicles having shared technologies (platform) with Ford Motor to increase our presence in India," de Voijs added.

Ford India President & Managing Director Arvind Mathew said, "Common platform models with Volvo cannot be ruled out in India."

Volvo plans to bring in its C30 and C70 cars, which share the platform with Ford's Focus range of cars, to India sometime next year.

Automobile analysts said a joint strategy could be an effective long-term growth plan for the two companies in the highly-competitive Indian market. "It seems to be a prudent strategy. Both the companies would leverage common technologies and resources to maintain their competitiveness," said Arvind Jain, an analyst with Religare Securities.

The platform-sharing strategy stems from the growing luxury car market in the A4 segment, which grew by 49 per cent last fiscal "" to 40,964 units in 2006-07 from 27,529 units in 2005-06. This segment is being targeted by leading players like DaimlerChrysler, BMW, Audi and Porsche.

Meanwhile, Volvo will make its debut in India with a sedan (S80) and a sports utility vehicle (XC90). Priced between Rs 45 lakh and Rs 60 lakh, these are expected to be launched later this year.

As both the vehicles will be imported as completely built units (CBU) and attract a customs duty of about 110 per cent, their pricing will place them at the top end of the A5 segment.