Volvo is to start selling vehicles online as it rolls out new models to compete with German luxury rivals such as BMW. The Swedish car maker‚ controlled by China’s Geely‚ will gradually introduce web sales and spend more on digital advertising‚ it said as it outlined changes to its global marketing strategy on Monday.
“The plan is to have all our car lines in all our markets offered digitally‚” Volvo sales chief Alain Visser said in an interview. Few manufacturers have tried selling directly online. A notable exception is Tesla‚ whose electric car sales have cut out traditional dealers‚ leading to conflict and effective exclusion from parts of the US.
But Volvo has assured its 2‚000 global dealerships‚ half of which are in Europe‚ that it has no such plans. “If you say the word ‘e-commerce’‚ initially dealers get nervous‚” Mr Visser said. “We don’t see a car distribution network without dealers in the foreseeable future‚” he said‚ adding that vehicles sold online “will still pass through the dealer network” for delivery.
Volvo raised its 2014 sales goal in August as it launched a revamped XC90 crossover‚ the first vehicle developed under Zhejiang Geely Holding Group ownership. With its flagship SUV and other models to follow‚ Volvo is ratcheting up the gadgetry and glitz to woo Chinese customers without losing sight of core attributes including safety and uncluttered Scandinavian design.
The Swedish car maker plans to withdraw from all but one motor show a year in each of three regions — Europe‚ North America and Asia — and stage its own global event instead. Volvo also said it would not follow rivals into city-centre boutique dealerships of the kind increasingly used by BMW‚ Mercedes-Benz and Audi. “We’re a different brand with limited financial means‚” Mr Visser said. “We don’t believe in building these big palaces.”
About 80% of Volvo customers already shop online for other goods‚ the sales chief said‚ and research suggested many would do the same for cars in future. But some analysts‚ such as Stuart Pearson of Exane BNP Paribas‚ remain sceptical‚ citing weak orders from experimental online sales of the BMW’s i8 hybrid sports car. “BMW has tried it in Germany‚ but they really haven’t had a huge amount of volume‚” Mr Pearson said. “People still want to go into dealers.”