Pat Olney, chief exec Volvo CE explained that the firm has been highly successful in building sales in China with its dual brand strategy - Volvo and SDLG
Volvo Construction Equipment (Volvo CE) has invested over US$150.93 million (SEK1bn) in expanding capacity and construction equipment offering in China and had secured a leading position in national wheeled loader and excavator sales, said Volvo CE president Pat Olney.
The Swedish construction equipment manufacturer is also keen to develop its SDLG brand, which, Olney stressed, has helped Volvo CE secure its status in the Chinese wheeled loader and excavator market.
Speaking during a press conference at bauma China 2012, Olney said: “It shows the strength and success of our dual brand strategy in China.”
Olney emphasised Volvo CE’s decade-long “investment and commitment” to the Chinese marketplace, and spoke of changing customer needs in the country, highlighting the increased preference for a wider range of solutions, used equipment, remanufactured parts and Volvo Financial services. These services are said by Olney to be being delivered to customers across China from an expanding network of clearly differentiated Volvo and SDLG sales and service branches.
Highlighting the variety of construction equipment available from the Volvo and SDLG (Lingong) brands, he added: “We have almost 300 different models of construction equipment between our two brands across the globe and, importantly, we offer a very extensive array of after sales support through our independent dealers throughout the world to support our customers.”
Olney said that such had been the success of the SDLG brand in Brazil that four models of SDLG excavator will be locally manufactured from 2013. Production will begin at a newly built SDLG facility in Pederneiras, São Paulo state, initially making four excavator models, the LG6150E, LG6210E, LG6225E and LG6250E.
On the impact of Chinese market conditions on Volvo CE’s Q3 2012 performance, Olney said: “The third quarter was a more difficult quarter for us. You could say that even though the Chinese market had been slowing, we continued to drive strong revenues in the Chinese market in the first half of the year. That was due to the fact that the mining industry continued to work and our customers continued to order, in particular, heavy equipment from us. In the third quarter we saw a very sharp slowdown which was affected by the temporary shutdown of the mines in China, but, in addition, we saw a general market slowdown in other parts of the world.”
Olney said that China remained “by far the biggest” market for the global construction equipment industry and that 2012 would still be the third best year in [equipment sales] history in the Chinese market.
“Our outlook for next year is for China to be relatively flat, but with growth coming in the second half,” added Olney.