Volvo 2011 Annual Report Download - page 29

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Growth plans for DND
Through UD Trucks, the Volvo Group has a joint venture
for trucks together with Dongfeng of China. A fact
unknown to many. The joint venture, DND, manufactures
heavy-duty UD trucks in a factory in Hangzhou in Southern
China. DND was included in the acquistion of UD Trucks
in 2007 and gave the Group access to domestic production
in China.
A number of European manufacturers are trying to get
into China, and some have shares in domestic companies
producing Chinese brands, but the Volvo Group is the
only Western manufacturer making trucks under its own
brand, UD, in the country.
China is the world’s largest truck market with registra-
tions of 899,000 heavy-duty trucks in 2011. DND had a
volume of 900 trucks in 2011, and the Volvo Group is
together with its joint venture partner examining different
possibilities to expand the cooperation in order to grow
the sales volumes within the DND framework. In addition
to the UD trucks being manufactured by DND, the Group
also sells some 1,000 Volvo trucks annually. These trucks
are built in Europe and shipped to China. With those
volumes, Volvo has a strong position in the European
segment of the market.
New Condor
During the year, UD Trucks
launched its new medium-duty
truck Condor, which had under-
gone a full model change. The
new trucks have a new cab
design that conveys the impres-
sion of a unified family identity with the Quon heavy-duty
truck series. They also feature various advanced techno-
logies accumulated on the company’s heavy-duty trucks
to deliver outstanding fuel economy, improved environ-
mental and aerodynamic performance and safety.
Technology Center in Jinan
A part of the increased focus on growth markets is the
development of products aimed particularly at those mar-
kets. Volvo CE’s new technology center in Jinan, China is
part of these efforts and covers both the Volvo and the
SDLG brand. Jinan is the capital of Shandong province
where Lingong has its manufacturing. The center entails
an investment of SEK 300 M, and when fully complete in
2013 it will have 200 employees and cover an area of
50,000 square meters.
Market development, heavy-duty trucks, Japan
Thousands
1110090807
2525193543
25
Market development, construction equipment, China
Thousands
1110090807
399371230251203
399
Volvo Group in Asia
• Net sales: SEK 73,586 M (65,487)
• Share of Group sales: 24%
• Number of employees: 19,924
• Share of Group employees: 20%
• Largest markets: China, Japan, India and South Korea.
Volvo CE and SDLG had
a combined market share of
12% in China
New company for electric and hybrid drivelines
in China
In April 2011, Volvo Bus and SAIC Motors of China
agreed to form a new joint venture company in China for
driveline systems for electric and hybrid buses. The new
company is 60% owned by SAIC and 40% owned by Volvo.
Volvo invests CNY 40 million and SAIC CNY 60 million
in the new company, Shanghai Green Bus Drive System
Co, based in Shanghai. The new company will industrialize
SAIC Motors and Volvo Buses research and development
projects within electric and hybrid drivelines for buses.
Since the beginning of the 21st century, Volvo and SAIC
together operate Sunwin Bus, which is one of the largest
city bus manufacturers in China. 25