Swedish luxury car maker Volvo Cars will start producing plug-in hybrid model, XC90 Excellence, locally in India from next year as part of plans to sell one million electrified cars globally by 2025, according to a senior company official.
The company, which today launched its entry level SUV XC40 in India at an introductory price of Rs 39.9 lakh, will also start local assembly of its SUV, XC60 at its Bengaluru plant from the third quarter of this year.
"Our long term strategy is for electrified vehicles. Very shortly, in terms of the automotive industry, we are going towards all electrified cars. We need to be ready in India just as we need to be ready anywhere else in the world," Volvo Car India Managing Director Charles Frump told PTI in an interview.
Volvo Car India currently sells the plug-in hybrid model XC90 Excellence priced at Rs 1.31 crore.
Globally, Volvo Cars has announced target of selling one million electrified cars by 2025 with 50 per cent of its sales volume to come from fully electric vehicles by 2025.
"If you think we are selling only 6,00,000 cars (globally) this year and by 2025 we are targetting one million electrified car. It has to include India," Frump said.
Elaborating on the company's roadmap in India, he said,"We want progress in our electrification journey. One of the big steps is we want to localise the production of that XC90 plug-in in hybrid.
"Our aim is to be the first automotive producer in India to locally produce a plug-in hybrid and we are going to do it next year."
A plug-in hybrid electric vehicle has both an internal combustion engine and an electric motor powered by battery which is charged by plugging into an electrical outlet or charging station.
Commenting on Volvo Car India's plans for local assembly, he said,"We started XC90 in October last year and quickly followed by S90. We will also be doing the same for XC60 this year."
Frump further said,"This will bring our CKD (completely knocked down) volumes to around 50 per cent of our total sales."
Volvo Car India currently assembles SUV XC90 and sedan S90 in India.
He, however, said the company doesn't have plans yet to locally assemble its new entry level SUV XC40 which was launched today.
The new model XC40 R-Design, which will compete with the likes of Mercedes Benz GLA, BMW X1 and Audi Q3, is powered by a 2 litre diesel engine with 190 horse power.
"The launch of XC40 and our aggressive dealer expansion of one new dealer per month this year are the key success factors in achieving our ambition of doubling segment share by 2020," Frump said.
Volvo Car India had sold a total of 2,029 units last year as against 1,585 units in 2016.
He said the new model completes the portfolio of SUVs for Volvo Car in India, which includes the top end XC90 and XC60.
"It is a particularly good time to enter the segment in India as it is the fastest growing with around 6,000 units a year," he added.
When asked if the company would consider bringing a petrol variant of the XC40, Frump said,"We are looking at the petrol option but 90 per cent of demand in the segment is diesel".
On the significance of bringing new models, Volvo Cars Vice President Asia Pacific Richard Snijders, "India is clearly the new upcoming force in the automotive business".
The XC40 is equipped with safety features such as oncoming lane mitigation, driver alerts and roll stability control besides seven airbags.
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