Volvo 2007 Annual Report Download - page 29
Download and view the complete annual report
Please find page 29 of the 2007 Volvo annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Share of Group net sales 2007
ness had SEK 3,317 M in sales. In China,
manufacturing was moved from Wuxi to Linyi
and is now coordinated with Lingong.
Thanks to this addition, the Volvo Group is in
a position to benefi t from considerably
increased investments in infrastructure, includ-
ing a major expansion of the road network that
is underway in both China and India.
Cooperation with Eicher Motors
In December 2007, the Volvo Group signed a
letter of intent with the Indian vehicle manu-
facturer Eicher Motors Limited regarding the
formation of a new Indian joint-venture com-
pany, which will include all of Eicher’s truck
and bus operations and the Volvo Group’s
Indian truck sales operations.
The intention is to immediately merge and
establish a joint service and dealer network
for trucks in India, at the same time that joint
projects in product development and purchas-
ing are initiated.
“The Indian market for heavy
trucks is the fourth largest
in the world and strategic-
ally critical for the
Volvo Group to be
able to take part and
offer Indian customers
products specially
adapted to their
market and needs,” says
Volvo CEO Leif Johansson.
The Indian market for
trucks over 5 tons totaled 300,000
vehicles in the fi scal year that ended on
March 31, 2007. Eicher is India’s third
largest manufacturer of trucks with a
market share in the 5-12 ton segment of
27%. The company recently entered the
growing heavy segment over 16 tons in India
and is already the country’s third largest man-
ufacturer there as well.
“India is already one of the world’s largest
truck markets and forecasts indicate that the
very strong growth will continue. Major invest-
ments in improved infrastructure as well as
more stringent regulations on load weights
will strongly drive demand for heavy trucks,
making the market particularly attractive to
the Volvo Group,” says Leif Johansson.
As a result of the deal, Volvo will acquire
direct ownership in the joint-venture company
of 45.6%. Because Volvo also intends to buy
8.1% of Eicher Motors Limited from its major-
ity shareholder, Volvo will have a combined,
direct and indirect interest of 50% in the joint-
venture company.
North America
18%
Europe
55%
Asia
15%
The joint-venture company will primarily
concentrate production to Eicher’s present
factory in Pithampur in northern India. It will
have approximately 2,300 employees and
operations in the joint-venture company which
come from Eicher had sales of approximately
SEK 3 billion and an operating profi t of SEK
128 M in 2006.
A global group 2007 25