Volvo Group expects strong growth curve in India thanks to infrastructure boost
Swedish automotive giant Volvo Group expects its business in India to see double-digit growth over the next few years, while its R&D operations in the country are expected to play an important role in the group’s global journey towards the future. net zero.
In India, Volvo is the best-known brand in the premium truck market, with a leading position in the segment. It has a successful joint venture (VE Commercial Vehicles) with Eicher Motors for consumer trucks and buses. Its other businesses include construction equipment, Penta engines for industrial applications and a financial services arm. It operates three factories near Bengaluru for Volvo Trucks, Volvo Buses and Volvo Construction Equipment.
The Volvo Group and its Indian operations experienced significant growth between 2016 and 2019. The profitability and revenue of the Indian operations also increased during this period. Although there was a drop in 2020 due to the pandemic, most businesses could return to pre-pandemic levels in 2021.
“With the exception of buses, all of our other businesses have returned to pre-pandemic levels. Trucks are doing very well, while the construction equipment sector is doing better than before the pandemic. Our Penta engines and financial services businesses are also doing well. Overall, we see pretty good traction going forward, although there will be temporary headwinds such as inflationary pressures and high commodity prices due to the war in Ukraine,” Kamal said. Bali, President and CEO of Volvo Group India. Activity area.
Impressive Infra History
He said massive spending on infrastructure development by the Indian government would bode well for the group’s business to see strong growth in the future.
“There is an impressive infrastructure history in India. This story has never been so good. Most companies, including the Volvo Group, linked to the infrastructure sector are expected to see double-digit growth. Even if our economy is growing at 7-8%, and if you add 4-5% inflation, there should easily be a natural growth of 12-13%. If you don’t grow at this rate, you will lose market share,” Bali said.
The group’s total revenue in India is estimated to be over ₹15,000 crore.
Net zero emissions objective
As its business sees bullish growth prospects, the company’s massive R&D operations in Bengaluru should facilitate the group’s transition to net zero emissions.
“The Indian R&D operations will play an important role in the Volvo Group’s net zero journey. The Bengaluru center is the group’s second largest R&D center after Sweden. About 2,000 engineers at the R&D center are working on innovative future technologies, including electromobility, alternative fuels, connectivity solutions, autonomous solutions, etc., Bali said.
The Volvo Group aims to achieve net zero emissions by 2040. By 2030, the group expects 50% of Volvo trucks in Europe to run on non-fossil fuels. Each country’s operations will take a different path to reduce emissions.
Its emissions journey in India began with sourcing what it calls “green castings” for its global engines. Manufacturing green castings (produced by Brakes India) will involve the elimination of chemicals and toxic elements and the use of minimal resources, where products can be recycled and reused and come with environmentally friendly packaging. the environment.
About four years ago, only 3% of global issues were processed by countries and companies around the world. Today, nearly 92 nations have come together to manage nearly 80% of net zero travel. “Sustainability is the key to future growth and survival,” he added.
July 03, 2022