Six years ago Volvo was in bad shape. Sales were plunging. Its lineup of cars was in need of an overhaul. And after losing gobs of money in the financial crisis, parent company Ford was determined to dump the Swedish car maker.
Things today look a lot brighter. After China-based Geely bought Volvo, it invested billions of dollars to turn it around. With two newly revamped models now in Volvo’s lineup, sales have started to rebound. Now the company is looking to the future, teaming up with Uber and other companies on developing autonomous cars.
Lex Kerssemakers [pictured above] is spearheading Volvo’s turnaround here in the United States. As CEO of the company’s Americas division, he oversees sales and research efforts here, including the recently announced research center in Mountain View.
Kerssemakers spoke recently with this newspaper about Volvo’s rebound, its research on electric and autonomous cars and its new Silicon Valley office. This interview has been edited for length and clarity.
Q Your sales increased from 57,000 cars sold in the United States in 2014 to 70,000 last year. What’s driving that rebound? And can it continue?
A Of course, the launch of our new car, the XC90. But also, we have been a little bit out of sight, out of mind. We really started to promote the brand again. And last but not least, our retailers are very much engaged because now they know what’s coming. We have showed them the entire portfolio.
In early 2019, the oldest car in our portfolio will be the XC90. So, we will have replaced every individual car we currently have in the product portfolio.
Sales are driven by an engaged retailer network and a good product portfolio. And we will have both.
Q As you’re revitalizing your fleet, what are some of the trends you are seeing and betting on?
A Fuel efficiency is very important. With fuel prices low, that’s fading a little bit away, but fuel prices will go up.
We believe four cylinders and three cylinders is the future, in terms of combustion engines. In the mid-term, you combine that with an electrical engine or electrical motor. What we have launched in the XC90 is our twin-engine concept, where we have a traditional four-cylinder turbo in the front and then an electrical engine in the rear.
In the long run, electrical cars will only increase. We strongly believe in electrification. We think that is the path where everybody is heading.
Q Do you have a full electric vehicle in the works?
A No, not yet. But we will around ’18, ’19.
Q Besides electric cars, Volvo is also putting a lot of effort into developing autonomous cars. Why is the company so enthusiastic about the technology?
A It’s so strongly linked to our heritage on safety. I can’t stress it enough. We strongly believe in autonomous drive. And it’s a little bit with surprise I see the polarizing discussions going on, that “I want to drive myself.”
But it’s not about that. It’s not about taking away the freedom to drive. It’s to make use of the technologies, to take out the mistakes. Thirty-three thousand people killed on the road. It cannot continue like that. And we have the technology. That’s what we started to launch in 2008. If I don’t brake on time, the car will brake for me.
And the next step, then, is convenience.
Q How do you see autonomous cars offering convenience to drivers?
A It’s about giving back quality time to individuals. That’s what we call Concept 26 — a car where you can have your meetings, where you can watch TV if you want.
I get 26 minutes average back of the time I normally would sit behind my steering wheel and being irritated in the traffic jam in San Francisco. That’s the next step. A screen pops up, your seat is going to relax, your telephone system is working in a different way. It’s your time, and you can do whatever you want with it.
Q From Volvo’s standpoint, what are the problems that still need to be solved with self-driving cars?
A The technology. How do you make all the systems work in such a way that it’s better than the human brain?
Maps will be a very important thing. I was sitting with the mayor of Los Angeles and he was driving using our autopilot feature, and suddenly it disconnected, because there were no lines on the road. So infrastructure is an issue.
But it’s mainly about making all the technology work into a car environment in a reliable way.
Q Volvo is opening a research center in Silicon Valley in part to work on autonomous car technologies. How will you divvy up your research efforts? Will the focus of this research center be different from what you focus on in China or Sweden?
A Oh, that depends project by project. But everything around electrification, infotainment will be here.
But at the end, we are a relatively small company. We are not in the position to be black and white about “you do this” and “you do that.” We literally need all the brain capacity we have available. So we are very flexible in allocating tasks all over the world. But we didn’t go for nothing to the Bay Area, that’s for sure.
© 2016 San Jose Mercury News under contract with NewsEdge. -.
