Volvo 2002 Annual Report Download - page 20

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18/19
Business Areas
Volvo Penta
Volvo Penta is a world-leading and global
manufacturer of engines and complete
power systems for both marine and indus-
trial applications. The company serves
customers in all parts of the world, prima-
rily within three areas of activity: Marine
Leisure, Marine Commercial and Industrial.
Based on a platform of Volvo’s large
production volume of diesel engines,
Volvo Penta develops high-performance
power products for a variety of applica-
tion areas, including leisure boats, work-
boats, power-generating equipment and
forklifts.
By supplying technologically superior
products focused on performance and
operational reliability, and sensitivity to
customer demands on effective service
solutions, Volvo Penta has developed a
global leadership position as a supplier of
engines and power systems, and one of
the industry’s strongest brands. With
more than 5,000 dealers in some 130
countries, Volvo Penta has a strong global
presence.
Volvo Penta has extended its product
range in all business segments through a
number of successful introductions during
the past years. The activity levels for new
product introductions will remain high, with
launches over the next few years resulting
in a renewal of the existing range.
Tot a l market
The global market for marine and indus-
trial engines gradually weakened during
the year, primarily as a result of a decline
in confidence in the future among con-
sumers and uncertainty regarding the
situation in Iraq. The total market for
marine and industrial engines in North
America continued to weaken during the
year, primarily regarding diesel engines. In
Europe, the demand for marine engines
was rather stable, while the market for
industrial engines declined. The market
for industrial engines continued to perform
positively in Asia, while the demand for
marine and industrial engines in South
America declined sharply compared with
2001.
Business environment
In the prestige segment of the leisure
boat industry, boats in the size range of
approximately 35 feet to 50 feet is a grow-
ing segment. This is to a great degree
favorable to Volvo Penta because it is in
this area of the marine market that the
company traditionally has its strongest
position.
Competition stiffened among engine
producers in the leisure boat industry dur-
ing 2002 as several new alliances and
cooperations were established in the
market. Brunswick and Cummins initiated
a new diesel engine cooperation and
Scania signed a commercial cooperation
agreement with Yanmar.
On the industrial engine side, the
largest producers of complete generator
sets have reported substantial sales
declines during the latter part of 2002.
Volvo Penta does not manufacture any
complete generator sets but instead
delivers power systems to the independ-
ent producers that, in turn, use Volvo
Penta products in their applications.
Volvo Penta has continued to capture
market shares in this part of the market
98 99 00 01 02
4.9 5.8 6.6 7.4 7.7
Net sales, SEK bn
98 99 00 01 02
95 314 484 658 647
Operating income*, SEK M
98 99 00 01 02
1. 9 5 . 5 7. 38.98.4
Operating Margin*, %
Net sales as percentage of Volvo Group sales, %
*excluding restructuring costs
*excluding restructuring costs
4%