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LI Shufu Decompressesonto Volvo, Reduce Cost by SPA platform Replacement

By Tiger Ruan  From Gasgoo.comApril 15, 2014

With slimming progress of Geely by multi- brands strategy, LI Shufu, president of Geely Group and Volvo Automobile Group makes his cost reduce by platform mode production idea comes true.

As it known, XC90, which is based onto SPA platform of Geely (includes powertrain, appearance, decoration, etc. reformation, which is more flexible, cost reeducation and efficiency), will mass production in the next half this year. XC60, which is geared with SPA platform new powertrainfactor, is introduced into Chinese market already.

SHEN Feng, vice president of research of Volvo Group China region says that from the perspective of technology, SPA is able to cover all modes at present. “The problem we are facing is mass production quantity of Volvo is not large enough, so we need united mode platform to reduce cost by accessories sharing.” SHEN Feng explains further that Volvo has turned over its disadvantage caused by disperse purchasing to realize cost reduce by SPA platform.

During an interview with LI Shufu at the end of year 2013, he says that Volvo has leaded into servertechnology areas, but high cost on purchase and manufacture is a problem bored Volvo for some years.

Volvo modes are dispersedseparately. Take engine for an example, it has 3 types such as in-line 4-cylinder, in-line 5, cylinder,in-line 6-cylinder. Some modes even are counted on Ford 2.0T engine. But because of sales of each type is limited which cannottrigger scale effort. Manufacture cost is high, and even bargaining power with accessories supplier is limited as well.

Cost cut becomes one of most important task for Volvo at this moment. Compared with original management system of Volvo, it is a once for all solution by top design imitating Volkswagen mode platform. Besides, it can avoidsmallfrictions among different departments.

According to SHEN Fang’s introduction, SPA platform is used for in-line 4-cylinder turbo engine. It will replace original 4, 5 and 6 series with different adjustment and electrification. The advantage will reflect onto engine manufacture and purchase cost, and improve technology at the same time.

As a core strategy of Volvo, SPA platformdeliveries cost cut by modelization. Besides, it is able to make up disadvantages of Volvo compared with other luxury brands: power and decoration.

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