The Volvo Car Corporation- a Presentation

(Valid for the financial year 1979).

The Volvo Group Volvo Car Corporation

The Volvo Car Corpor

Assembly facilities(number of cars assembled)Volvo Torslanda PlantSweden 145,600 Top Ten MarketsVolvo Car B.V.The Netherlands 90,500 (number of registered Volvo car sales)

Volvo Europa N.V. Ghent 1 Sweden 55,800

Belgium 37,200 2 USA 53,7003 Great Britain 36,600

Volvo Kalmar Plant 4 The Netherlands 27,000Sweden 27,500 5 West Germany 25,000Volvo Canada Ltd 6 Belgium 13,300Canada 8,600 7 Norway 9,400Other facilities 8 France 8,900(Australia, Malaysia, 9 Italy 8,400I ndonesia, Thailand) 10,600 10 Switzerland 7,500

SalesI ncome before allocationsand taxesI nvestments in property, plantand equipmentNumber of employees

SEK 23,472 million SalesI ncome before allocationsand taxesI nvestments in property, plantand equipmentNumber of employees

SEK 12,616 million

SEK

SEK

1,244 million

962 million

SEK

SEK

340 million

654 million25,000

( Dec 31, 1979) 65,000 Production - number of cars 320,000Sales-number of cars 302,000of which Volvo 260/240 Series 219,000

Volvo 66/340 Series 83,100

ration -facts and figures•

A member of the Volvo Group, the Volvo Car Corpora-tion is responsible for the development, manufactureand marketing of the car programme.

•

Volvo has a well established international position withthe Volvo 240 and 260 Series. In the USA, for example,the Volvo 240/260 Series cars have for many yearsbeen the best selling cars in their class among import-ed makes. The Volvo 240/260 Series are among thebest selling cars in Europe in this class. The productionprogramme for the Volvo 340 Series has been doubledi n stages.

•

The Volvo Car Corporation has authorized a long-termdevelopment programme with the aim of ensuring Volvothe technical capabilities and the product standardswhich will be required by the late 1980s. ln 1979, Volvoconcluded an industrial co-operation agreement onresearch, design and product development withRenault. The French company simultaneously acquired10% of the shares of the Volvo Car Corporation withthe right of refusal on a doubling of the shareholding.

• The Volvo Car Corporation has entered the 1980s withvery high capacity utilization in its assembly plants andwith a vigorous demand for its products on the majorityof the major markets.

The Volvo Group is the largestengineering enterprise in the Nordicarea with the emphasis in its produc-tion mainly on products for the worldof transportation. Since 1969, saleshave increased from SEK 4,400 millionto SEK 23,472 million in 1979. Thetotal labour force numbers more than65,000.

The car operations are responsiblefor slightly more than half of the turn-over, trucks and buses representingslightly more than a quarter. Otherproducts manufactured by the VolvoGroup include marine and industrial

The Volvo Car Corporation is amember of the Volvo Group and alimited liability company with responsi-bility for the car programme, thiscovering product planning and productdevelopment, engineering and design,purchasing, manufacture and alsoassembly, marketing and service.

The Volvo Car Corporation hasassembly plants in Sweden and abroadas well as a number of componentproduction facilities. Volvo Car BV, of

Since 1977, the Volvo Car Corpora-tion has increased its capacity utiliza-tion significantly in step with thegrowing demand. In 1977, Volvo carproduction was 225,000 units whilethe equivalent figure for 1979 was320,000 units. Heavy capital expen-

This is the VolvoThe Volvo Group

engines, earthmoving, agricultural andforestry machines, aircraft engines,hydraulic machines and leisureproducts.

Volvo Car Corporation

which Volvo owns 55% -the remaind-er being owned by the Dutch State -builds the Volvo 340 Series. Othercompanies within the Group alsomanufacture components for the caroperations.

Production up by100,000 units

Car Corporationditure in plant and equipment hasbeen made to automate production,this concerning especially the mono-tonous and heavy work.

MarketingAn attractive product programme

featuring much improved, advancedhandling characteristics, and verycompetitive prices thanks to thegreater efficiency of the Volvo organi-zation have resulted in a very favour-able sales development for both theVolvo 240/260 Series and the 340Series on practically all of Volvo's mainmarkets.

Labour forceThe Volvo Car Corporation has

more than 25,000 employees, 1 7,600of which in Sweden. Within the othercompanies of the Volvo Group, about8,000 people are engaged in produc-i ng parts and components for Volvocars. Working in close co-operationwith the employees and their tradeunions, Volvo endeavours to developforms of work and work environmentwhich are compatible with the inte-rests, involvement and competence ofthe employees, this resulting in higherl evels of job satisfaction, efficiency and

consistently high quality standards.Volvo's use of advanced productiontechnology combined with new con-cepts in work organization has attract-ed attention from all over the world.

Developing the

The Volvo Car Corporation's safety centre has all the latest equipment needed to research automotive safety problems. With the help of this catapult,for instance, collisions can be simulated without crashing any car bodies. The emphasis in these facilities is on interior safety.

cars of tomorrow

Complete cars are crashed in full scale tests.Changes in the construction of the body aretested as is its resistance, or crashworthiness,in various types of collision. Each phase of thecollision is registered, giving valuable data forthe continuing development work.

Dynamic safety is a major concept at Volvo. Itmeans that the car must react in a controlled andpredictable manner even in emergency situa-tions. A well fried and tested steering system isan important part of dynamic safety.

Aluminium, plastics and rubber areexamples of materials which are becomingmore and more important to the automotiveindustry. New and old materials alike aretested in the Volvo material laboratories.

There are a great many factorswhich influence the design of a car.Customer preferences, legislativerequirements enforced by differentcountries such as those on road safe-ty, energy conservancy and environ-mental compatibility are a few of themore important. The development oflighter, less energy-demandingvehicles must be given priority. Thedemands for cleaner exhaust gasesand still higher standards of safety-fields in which Volvo holds a prominentposition - imply significant develop-ment costs.

Larger resourcesAs a consequence, the Volvo Car

Corporation is concentrating morethan ever before on product develop-ment.

The short and long-term productiondevelopment facilities of the Volvo Car

Engine development takes up a significantpart of the total vehicle's developmentprogramme at Volvo. Understandably, fuelconsumption and exhaust emission controlare major factors. Thanks to its LambdaSond System, Volvo has achieved morethan any other car manufacturer in thestruggle to reduce exhaust emissions.

Corporation are situated in Gothen-burg, Sweden and Helmond in TheNetherlands. The Technical Centre,close to the Volvo Group Headquartersi n Gothenburg, has about 2,000 staffi n its engineering departments, labo-ratories and experimental workshops.A few miles outside of Gothenburg isthe Volvo Proving Ground which playsan essential role in the current deve-l opment work.

Co-operative agreementwith Renault

The Volvo Car Corporation andRenault concluded an agreement in1979 on industrial co-operation. Thepurpose of this agreement is to boostthe competitive strength of both com-panies by collaboration in matters con-cerning research, product develop-ment and production. The terms of theagreement will enable the product

Hand crafting and modern computer tech-nology meet and integrate in the patternsworkshop. With the help of numeric shap-ing technology, the draughting work can bedone in a much shorter time than previous-ly. However, when it comes to putting thefinal touches, the human hand is stillmaster.

The suspension system is a very decisivefactor in road-holding - and consequentlyalso in dynamic safety.

programme to be renewed at a fasterrate and will also open up new auto-motive engineering design concepts.

New material for moreefficient energy utilization

As part of its future-orientated workon the Volvo cars of tomorrow, theVolvo Car Corporation has started aseparate development project in co-operation with Norwegian industry.The intention is to develop newdesigns and test conditions for theadvanced use of new materials suchas aluminium, composites and plas-tics.

Volvo facilitiesI n addition to its facilities in Sweden,

the Volvo Car Corporation has anumber of car assembly plants inother countries, namely The Nether-lands, Belgium, Canada, Australia,Malaysia, Indonesia and Thailand.

Approximately 60% of total produc-tion is assembled in Sweden.

"Building cars the Volvo way"i mplies that the Volvo Car Corporationi s responsible for the design, develop-ment and assembly of the products. Asignificant proportion of the majorcomponents and systems are manu-factured within the Volvo Car Corpora-tion or by other companies within theVolvo Group. This includes pressings

and bodies, gearboxes, engines, axlesand interiors.

1,500 suppliersA total of about 1,500 suppliers in

Sweden and abroad provide the Volvoassembly plants and parts warehouseswith materials.

Volvo's stringent quality require-ments apply whether the parts andcomponents are made in the com-pany's own facilities or by a Volvosupplier. The high standard of Volvoquality is built in from the start, on thedrawing boards and throughout deve-l opment work through solid engineer-

i ng and clear-cut specifications. Under-standably, an essential part of thiswork is the further training of the workforce. Product quality is checked con-tinously through goods receptioni nspections, during production, andprior to delivery. Stringent quality con-trol is one of the cornerstones of thel ong life expectancy of Volvo products.

The Volvo Torslanda Plant in Gothenburg is Volvo's largest facility. The Volvo 240/260 Series are manufactured and assembled here. Volvo has carassembly plants in nine countries.

and suppliers

Volvo Car Corporation - major manufacturing andassembly plants

SwedenVolvo Torslanda Plant, Gothenburg.

This is the Volvo Car Corporation'sbiggest assembly plant with about9,000 employees. The facilities in-clude: Pressing shop, Body shop,Paint shop and Assembly shop. Fullypainted bodies together with othercomponents from the Torslanda Plantare sent to the assembly facilities inKalmar and Canada.

Volvo Kalmar Plant, Kalmar. This isa unique final assembly plant withregard to the technologies used, thework environment and work organiza-tion. Since opening in 1974, the VolvoKalmar Plant has attracted a great dealof international interest for its advanc-ed design. Most of the work is carriedout by groups of between 15 and 20workers. The bodies are transportedon battery powered and individuallycontrolled carriers. In this manner,each team can vary its workingmethods and work rate, this beingfacilitated by the buffer stocks whichcan be built up between the differentteam areas.

The number of Volvo employees atKalmar i s more than 750 and they pro-duce approximately 25-30,000 carsannually.

Volvo Olofström Plants, Olofström.This is Scandinavia's largest metalpressings industry with 4,000 em-ployees. Volvo Olofström has been amember of the Group since 1969. Its

facilities produce body pressings forcar production as well as pressingtools and machines for welding andassembly of body components. Theproduction programme also includessilencers and fuel tanks. An associatedfactory at Konga manufactures variouscomponents including rear axlecasings and heavy components forVolvo trucks and buses.

Volvo Dalsland Plants, Dalsland.These facilities are made up of threeplants which are responsible for inte-riors, including seat upholsteries, seatbelts and various injection mouldedplastics components. The three fac-tories at Bengtsfors, Färgelanda andTanumshede employ approximately1,000 persons.

Volvo Group CompaniesI n addition to the components

manufactured in the above facilities-which belong to the Volvo Car Corp-oration-components are producedby other companies of the VolvoGroup, prominent among these beingthe Volvo Component Corporation.The four-cylinder petrol engines forthe Volvo 240 Series are built at theSkövde Plant while at Floby, the pro-duction programme includes wheelhubs and brake discs. Gearboxes,front and rear axles and front suspen-sion units are manufactured at Köping

Facilities in Europe,America, Australia and Asia

BornVolvo 340 Series cars are built at

Born in South Holland. Like the Tors-l anda Plant, Born has its own pressingshop. These facilities are about 10years old and employ approximately4,600 people.

St. TruidenComponents including steering

boxes, automatic transmissions, rearaxles and brakes for the Volvo340 Series are manufactured at St.Truiden, Belgium. 800 people workhere.

Ghent

The Volvo Car Corporation's secondl argest plant in Europe is at Ghent,Belgium. Volvo 2401260 Series carsfor the European market are built here,production during 1979 exceeding35,000 units.

Other facilities

The Volvo Car Corporation hasassembly plants in a number of othercountries. In some cases, they arewholly-owned subsidiaries, in othersthey are jointly owned.

The assembly plant at Halifax,Canada, is the largest of these facilitieswith its 160 employees and an annualproduction of more than 8,000 units.Number two in size is the AustralianPlant. I n the Far East, Volvo cars areassembled at four smaller facilities,namely those in Malaysia, Indonesia,Thailand and Singapore.

Engine co-operation withPeugeot and Renault

The recent cooperation agreementwith Renault is not the only example ofl ong-term collaboration; together withPeugeot and Renault, Volvo has anengine plant at Douvrain in France. Iti s here that the six-sylinder engine isbuilt.

9

Volvo round the world

A historic review

Ever since the start in 1927, Volvohas concentrated on exports. TheNordic countries and South Americawere among the first export markets.

During the 1950's, the Volvo orga-nization in Europe was graduallystrengthened. In 1956, the VolvoPV 444 was introduced on theAmerican market and was an imme-diate success.

Since 1960, Volvo car sales havequadrupled in number.

Volvo cars are marketed by sub-sidiary companies and independenti mporters. Today, the Volvo Car Corp-oration has more than 2,500 dealers -many of whom have a number of salesoutlets.

"The Volvo class"

The Volvo Car Corporation has astrong hold on the class in which the

Volvo 240/260 competes. TheseVolvos are among the best selling carsi n Europe in this class, excludingdomestic markets. In the USA, theVolvo 240/260 Series have been thebest-selling imported car in theirrespective class for a number of years.

Thanks to the 340 Series, the Volvodealer organization has been able toi ncrease its penetration of the small-

to-medium class. The Volvo 340Series is in great demand and theproduction programme has now beenmore than doubled, thanks not least tothe introduction of new versions.

Rapid growth - particularlyin Europe

The growth of the Volvo Car Corp-oration during the last five years hastaken place primarily in Europe. Thistable shows the sales values for1974-1978 within Volvo's marketareas.

The term "other markets" covers al arge number of countries primarilythose in Asia, Africa and SouthAmerica. Japan, Nigeria and Australiaare the three major Volvo marketswithin this area.

Cars sales, SEK millions

74

75

76

77

78

79

Market area

Other markets

North America

Europe excl.Sweden

Sweden

15 countries dominate

Within the larger market areas,Volvo has concentrated its marketingefforts to a number of major areas. The15 largest markets account for almost90% of corporate sales. Volvo cars aresold in about 60 different countries.

Volvo car registrations in1979:

Service and parts

Service and parts accessibility playa significant role in the marketing ofcars. The Volvo dealer networkassures the customer of an efficientservice organization and reliableaccess to parts. In Europe alone,excluding the Nordic area, Volvo hasapproximately 1,500 dealers.

1 Sweden 55,8002 USA 53,7003 Great Britain 36,0004 The Netherlands 27,0005 West Germany 25,0006 Belgium 13,3007 Norway 9,4008 France 8,9009 Italy 8,400

10 Switzerland 7,50011 Finland 7,30012 Australia 6,70013 Denmark 6,60014 Canada 6,60015 Austria 4,200