Thanks to the increasing popularity of its two most affordable models, 2019 appears to be the year in which Volvo’s U.S. operations will appear firmly and solidly back on track. For the first time since 2007, Volvo is set to sell more than 100,000 vehicles in the United States. At the current 6 percent growth […] More...
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Thanks to the increasing popularity of its two most affordable models, 2019 appears to be the year in which Volvo’s U.S. operations will appear firmly and solidly back on track.
For the first time since 2007, Volvo is set to sell more than 100,000 vehicles in the United States. At the current 6 percent growth rate, Volvo is on track for a 12-year high. 60 years since the Swedish brand landed in America, and nearly a decade since its U.S. ownership phase ended at the hands of Ford, the now Chinese-owned marque is on the ascent for very much the same reason it was when setting sales records in 2004.
A mix of popular utility vehicles and growth from its entry-level models.
Of course, one key difference between 2004 (when Volvo USA reported 139,384 new vehicle sales) and 2019 relates to the fact that those two categories have merged. Volvo’s most affordable vehicle, the $33,700+ XC40, is also an appealing utility vehicle with steadily improving sales figures.
Through the first five months of 2019, the XC40 and new S60 sedan have produced more than 7,000 additional sales for Volvo, compared with the same period in 2018. The gains produced by those two models are of huge consequence – the rest of Volvo’s lineup is down 15 percent this year. The under-$36K duo now accounts for 34 percent of the brand’s U.S. volume, nearly double their share from a year ago.
The XC40/S60 gains, should they hold, will be responsible for driving Volvo into a new era as a moderately high-volume premium brand. Though far from the heights of Mercedes-Benz and BMW – with more than 250,000 sales between them, year-to-date – Volvo is further separating itself from Jaguar to produce the kind of regular output we see from Land Rover. (Yes, those three are all former Ford-owned brands from Jacques Nasser’s Premier Automotive Group days.)
This latest surge from Volvo comes after a post-recession seesaw that produced growth in 2011, 2012, 2015, 2016, and 2018 along with declines in 2010, 2013, 2014, and 2017. We’ve seen growth like this from Volvo in the past, as the brand roughly doubled its sales between 1980 and 1985, the first time Volvo reported more than 100,000 sales in the United States. In the late 80s, Volvo sold more than 100,000 cars four times in the span of five years before slowing considerably in the early 90s, according to CarSalesBase.
Volvo once again picked up steam as the 21st century approached, rising 39 percent between 1996 and 2000. It was the 2002 launch of the first-generation XC90 that propelled Volvo to its record sales achievements in 2004. Nearly three in ten Volvos sold in America that year were XC90s; the XC70 accounted for better than one in ten.
XC-branded models are far more important to the brand now, even with the third-generation S60 finding more than 1,300 buyers per month. For every passenger car Volvo sells, Cross Country versions of the V90 and V60 included, Volvo sells four XC models: XC40, better-selling XC60, or top-selling XC90.
Here’s another way of looking at it. Those three utility vehicles are on pace for around 87,000 U.S. sales during the 2019 calendar year – that’s more than the number of Volvos sold, in total, in the U.S. in 10 of the last 11 years. And while the XC40 is the least common of the three, it’s easily the most competitive in its segment.
BMW’s class-leading X5, for instance, outsells the XC90 by a 58-percent margin. A segment below, the Mercedes-Benz GLC sells more than two copies for every one Volvo XC60. But in the entry-level premium crossover segment, the XC40 takes the fight to the Mercedes-Benz GLA and BMW X3, trailing each of the Germans by little more than 200 units per month. The XC40 was very nearly the segment leader in May.
That fact should tell you something about Volvo’s future in the United States. Never has the Swedish brand, famous for its safety reputation, ever been put on the same pedestal as the primary German luxury automakers. Despite high style marks across the brand, a Volvo simply doesn’t have the same cachet. An S60 doesn’t carry the same weight as a 3 Series, an XC60 doesn’t make the same statement as a GLC, a $105K XC90 Excellence doesn’t seem as deserving of its price stratosphere as a Range Rover.
But in the XC40, Volvo is the conspicuously de-commodified option. The X1 and GLA represent the Germans’ push downmarket, and however effective and improved they may be in second-gen forms, they seem to share little in their mission or appointments with the 7 Series and S-Class flagships that for so long defined their brands.
The XC40, even as the semi-affordable Swede, still embodies the essence of Volvo. It is the first Volvo since the first XC90 that may well beat the Germans at their game in the marketplace. And it’s the Volvo that’s likely to shove the brand back into the swing of things as a six-digit seller in the United States.
Volvo USA Is Having Its Best Year Since 2007 As 2019 Sales Are Set to Top 100,000 appeared first on Swedespeed.