Volvo is about to usher in its "big year"

A 100,000-word article: Tesla must win

Author | Zhou Zhiyu

In the past, the MPV market had limited players due to its limited usage scenarios and the performance limitations of fuel vehicles.

However, whether it is the 17.34% YoY growth rate of the MPV segment market in the first three quarters, or the intensive launch of MPV models by various car companies at the recently opened Guangzhou Auto Show, it indicates that this segment market is gradually becoming the focus of attention for car companies and is an important growth area.

As the traditional luxury car brand that started the electrification transformation earliest, Volvo also globally debuted its pure electric MPV model EM90 on November 12th. With a price of 818,000 yuan, this car has become the most expensive pure electric MPV currently on the market.

Yuan Xiaolin, Senior Vice President of Volvo Car Group and President and CEO of Volvo Car Asia Pacific, pointed out that Volvo's entry into this market is timely. MPV market users are very concerned about safety, and Volvo, with its safety genes, has a competitive advantage in entering this market.

After its debut in China, EM90 will also be launched in international markets. This is another dimension of the global new energy market pattern, exporting successful technologies and cases from China to the world.

Yuan Xiaolin revealed that in the next dozen months, Volvo will have more new products coming out. Volvo's "big year" is coming.

With the further enrichment of its product matrix and continuous construction in brand and system capabilities, Yuan Xiaolin believes that Volvo is solidly advancing its transformation. In the face of transformation challenges and opportunities that all automotive practitioners are facing, this allows them to be more composed. "Change what can be changed, accept what cannot be changed, remain unaffected, and then do what we should do."

The current trend of transformation in the automotive industry is irreversible. In the industry cycle and the tide of the times, how to have the last laugh and become the winner of the long run. Volvo hopes to be one of them.

The following is a transcript of the conversation between Wall Street News and Yuan Xiaolin (edited):

Q: How do you view the current MPV market and the competitive landscape that EM90 faces?

Yuan Xiaolin: I believe that Volvo EM90 has entered the market at a good time.

On the one hand, with the gradual increase of the "big family structure" consumer group in the Chinese market, the potential of the Chinese MPV market is increasing. The recognition of the luxury MPV market with six/seven seats and new energy is constantly increasing. In this segment market, consumers value the strengths of Volvo cars the most - safety + intelligence. At the same time, there is still a relatively large space in the high-end pure electric luxury MPV market.

MPV users are very concerned about safety, and Volvo is a brand with prominent safety genes, so it has a competitive advantage in entering this market. I believe that everyone will see the performance of EM90 in the Chinese market, and other regions of the world will also see its performance.

Q: Many car companies are facing the challenge of transformation and may consider entering the market with plug-in hybrids, extended-range vehicles, or slightly lower-priced products to expand market share. Why did Volvo choose to launch a high-end MPV priced at over 800,000 yuan? Yuan Xiaolin: The electrification transformation is the biggest change that the automotive industry has faced in over a hundred years. This transformation is not simply about changes in powertrain. It essentially involves two changes: one brought about by digitization, which entails a comprehensive reevaluation of mobility, and the other, represented by pure electric vehicles, which brings about a transformation in the experience of mobility.

In the face of this transformation, the biggest challenge is a systemic one. It's not just about quickly launching a few models; it's about transforming your entire operational system to align with a long-term electric strategy. It's about creating a system that can match this strategy. Therefore, it's not something that can be achieved overnight. It requires solid and long-term work. In simple terms, it takes time, especially when it comes to something related to the life, health, and safety of the people. I believe it needs to be approached with great caution.

For products, the important thing is to consider who you are targeting and whether you can match their needs. This is a matter of positioning.

The EM90 combines the best technologies available in the market and presents a distinct Volvo character within a short period of time. It is a genuine Volvo, and that is the most important thing.

Q: Who is the target audience for the EM90?

Yuan Xiaolin: The target audience for the EM90 can be summarized as top achievers of the new era. They value sharing time and space with their loved ones and seek the best life experiences. They aspire to change the world and influence others, rather than pursuing fame and fortune. In short, they want to enjoy contemporary luxury while establishing new connections and experiences with like-minded individuals and charming places.

Q: What role does the EM90 play in Volvo's product lineup?

Yuan Xiaolin: Its main role is to enrich the product lineup and complete the entire product spectrum.

The Chinese MPV market is full of potential, and there is significant room for growth in the penetration of new energy MPVs. It is an attractive niche market that aligns well with Volvo's people-centric philosophy. When there is such a strong demand in the Chinese market, the EM90, with its distinctive character, provides everyone with a very compelling option to consider.

I believe that in the next few months, we will see more new Volvo products coming out. The Chinese New Year is approaching, and in the completely blank MPV segment, you can plan anew. Therefore, it will be relatively faster. In other more established segments, there will be their own cycles.

Q: Traditional car companies are generally facing challenges in the transition to new energy. How is Volvo promoting the transition to new energy?

Yuan Xiaolin: All automotive practitioners are facing a period of transformation, opportunities, and challenges. In the face of this, there are actually many things that haven't changed. I have always said that OEMs should focus on three things: products, brands, and systems.

Everything boils down to these three areas of focus, and ultimately, it is the combination of these three elements that determines your performance in the market—whether you survive, perish, or have a healthy development. In the wave of the large-scale electrification transformation, Volvo's answer to how to make choices is to focus on product development, brand building, and a strong system that adapts to the travel industry in the era of electrification and intelligence.

Q: After the product enters the "big year", how do you evaluate the brand and system? When is the right time for an explosion?

Yuan Xiaolin: In terms of products, Volvo has proposed electrification transformation early on and has already achieved electrification across its entire product line. In recent years, we have made sufficient preparations in terms of production line transformation, three-electric development, charging network, and sales channels, in order to accumulate strength for the intensive release of subsequent products. With a solid foundation, I believe our future transformation will be faster.

In terms of products, brand, and system, the key is to balance market share, profitability, and the health of partners. I think we have seen very solid data in these dimensions, which proves that we are solidly promoting the electrification and intelligence transformation.

This process is definitely not smooth sailing. The Chinese automotive market is undergoing a reshuffle, with opportunities and challenges coexisting. This situation is very inspiring, and we will continue to maintain an open and inclusive mindset and actively embrace change. If our work is solidly grounded in these directions, our mindset and emotions will also be calm and composed. Change what can be changed, accept what cannot be changed, remain unaffected, and do what we need to do.

Q: How do you think the competition in the luxury car market will evolve in the era of electrification?

Yuan Xiaolin: In the era of electrification, competition in the luxury market will definitely involve both risks and opportunities. For Volvo, adhering to unique brand concepts and values in the long term will definitely gain recognition from users.

In terms of development, it is necessary to achieve a balance among market share, business sustainability, and the health of the entire partner system. This balance needs to be built on a foundation, which is the brand. No matter how we develop or where we go, we must be ourselves and adhere to our own values.

Therefore, we must adhere to our brand and pursue the ultimate in safety, health, and sustainability. This is the characteristic that sets Volvo apart from other brands. Differentiating our brand and strengthening our brand value and safety awareness are the keys to winning the long-term market.