Volvo 2006 Annual Report Download - page 15

With investments in India and China, we aim to
share in their growing economies, in the man-
ner that we are now experiencing in Eastern
Europe.
New phase in Asia
In order to strengthen our position in Asia, we
have taken several steps of significant strate-
gic importance. Within the truck segment, we
established a strategic alliance with Japanese
Nissan Diesel. To start with, we acquired a 19
percent holding in Nissan Diesel and in Fe -
bruary, 2007, we made a public offer for the
whole company.
Nissan Diesel holds a solid position in Japan
and the rest of Asia. A merger would give
advantages within product development and
purchasing as well as within the production of
engines and drivelines. Gains also arise in that
the companies are given access to each other’s
dealer and service networks.
The cooperation with Nissan Diesel has also
resulted in more in-depth discussions about
future coordination with China’s largest truck
manufacturer, Dongfeng Motors.
In China we have also entered an exciting
new phase through the purchase of 70 percent
of the Chinese wheel loader manufacturer
Lingong. As the first foreign manufacturer of
construction equipment, we gain a base with a
nationwide dealer network in China.
Broader offering to
customers
Parallel with investments on new markets, we
are increasing efforts to expand our offering of
services, accessories and spare parts. We view
this as our greatest possibility to create long-
term growth in established markets. In this
respect, we are working with intensifying coop-
eration with customers to develop broader
business solutions. Customer financing is an
important component in this respect and for
expansion in markets with a less developed
credit system.
An important part of our strategy for
increased profitability is the growth of ser-
vices, accessories and spare parts.
New technology for a better
environment
As a vehicle manufacturer, we have
major responsibility for the en -
vironment and to contribute to a
sustainable society. We view this
responsibility with the greatest
seriousness. We have set very
high goals to reduce energy con-
sumption in production and to
make more of our plants carbon -
di oxide neutral. In the midst of this tough
period I have described, we have also inten-
sified the development of alternative drive-
lines to reduce fuel consumption and the
emission of greenhouse gases. Among
other activities, we presented our fuel-
efficient hybrid technology in 2006, which
we plan to have in production in 2009.
Successful integration work
I wish to thank all employees for an excel-
lent job. In my opinion, and that of the Board, we
have succeeded well with the difficult task of
integrating new companies and implementing
structural changes. This is thanks to our hard
work each day in an organization that has per-
formed in a disciplined and motivated manner.
2007 will be an exciting year during which
we will have the entire new product generation
on the market and take new strides in the
expansion eastward.
Leif Johansson
President and CEO
A global group 2006 11