"by not believing to a good Volvo just in order not to be exposed."

I'm sure that something has been lost in translation here, but I really don't understand what you are trying to say.

That said, if Geely is looking to position Volvo as a near luxury car in China and by implication, the US market, then all I can say is "It's about time". This idea of selling Volvo to BMW customers is lunacy. These are not the same people, at least not in my experience. Volvo is NOT a luxury car in the way that Mercedes is and it is NOT a driver's car in the way that that a BMW is. What it IS , is a car for those with means but who desire substance over flash in their automotive choice. A return to Volvo's rightful place as a near luxury brand, and a return to appropriate pricing, is exactly what's needed if Volvo is to survive - no matter who owns the company.

 

Re: (seattle)

A premium or luxury product it's not defined in economics by leather seats etc. It is defined by income elasticity. The higher the income or the propensity to spend on a car, the higher demand for a Volvo. That is shown by my results....
As for exposure I mean "to show off"....
Volvo products are at the same level as BMWs and Audis and maybe Mercedes products but in their own way. The way of safety, individuality, minimalism, reliability, design, comfort, power and swediness....We do not want a Volvo to compete with Honda and Toyota as Autonews article claims. This would be the end of Volvo, at least for its production in Europe... Volvo has to cut costs by worsening its quality and craftmanship in order to compete against Honda and Toyota and remain its production in Europe.....

 

Re: Volvo 2009 results - BMW comparison (tolis)

Quote, originally posted by tolis »

Just a comparison: BMW Automotive division Revenue 2009: $43,740million BMW car sales 2009: 1,286,310 cars Revenue per car sold: $34,004/BMW Volvo Cars 2009 Volvo Revenue 2009: $12,442million Volvo Cars sales 2009: 334,808 cars Revenue per Car sold: $37,162/Volvo

Interesting! I need to think about it some more to understand its true significance.

 

Re: Volvo 2009 results - BMW comparison (Calhon)

Quote, originally posted by Calhon »

Interesting! I need to think about it some more to understand its true significance.

The significance is volume which generates all kinds of positive things (i.e. more production on the assembly line, more service business, more parts, more accessories, etc.)

 

Re: Volvo 2009 results - BMW comparison (GrecianVolvo)

Quote, originally posted by GrecianVolvo »

The significance is volume which generates all kinds of positive things (i.e. more production on the assembly line, more service business, more parts, more accessories, etc.)

The economy of scale issue is pretty straightforward ... not much to ponder there. I'm thinking about the significance of the revenue per car comparison in the context of brand perception.

 

Re: Volvo 2009 results - BMW comparison (Calhon)

Quote, originally posted by Calhon »

The economy of scale issue is pretty straightforward ... not much to ponder there. I'm thinking about the significance of the revenue per car comparison in the context of brand perception.

Not sure that is vital to whoever is involved with brand perception as you have to dig further in order to see why a brand makes more per car. How does that profit translate in terms of its origins? Why is a company selling more showing a lesser profit per car? What other expenses (that could, possibly, contribute to increased sales) are factored into those numbers?

 

Re: Volvo 2009 results - BMW comparison (GrecianVolvo)

So Volvo's revenues per car are more than BMW yet at the same time it loses money hand over fist, it seems to me that costs are out of control, or more likely Volvo is overly burdened with Glass House overhead. When you have to pick up a share of the executive payroll in Dearborn, yet only sell 65,000 cars its tough.

 

Re: Volvo 2009 results - BMW comparison (Sausca)

Quote, originally posted by Sausca »

When you have to pick up a share of the executive payroll in Dearborn, yet only sell 65,000 cars its tough.

I suspect Swedish labor costs and benefits have a lot more to do than any overhead attributable to FoMoCo. You don't get 7 weeks of vacation and one year paid parental leave for free.

 

Re: Volvo 2009 results - BMW comparison (Sausca)

Quote, originally posted by Sausca »

So Volvo's revenues per car are more than BMW yet at the same time it loses money hand over fist, it seems to me that costs are out of control, or more likely Volvo is overly burdened with Glass House overhead. When you have to pick up a share of the executive payroll in Dearborn, yet only sell 65,000 cars its tough.

This discussion can get very complicated. However, I can give you this fact:

In 2008, Volvo had posted a loss of $738 million. In 2009, its pre-tax operating loss was $32 million.

 

Re: Volvo 2009 results - BMW comparison (GrecianVolvo)

Quote, originally posted by GrecianVolvo »

Not sure that is vital to whoever is involved with brand perception as you have to dig further in order to see why a brand makes more per car. How does that profit translate in terms of its origins? Why is a company selling more showing a lesser profit per car? What other expenses (that could, possibly, contribute to increased sales) are factored into those numbers?

OP wasn't trying to make any point about why Volvo is operating at a loss despite having a higher revenue per car than BMW, which is making a profit. In fact, he didnt even mention BMW's profit. OP is suggesting that Volvo's higher revenue per car says something about brand perception vis a vis BMW; i.e., it seems Volvo is selling its cars at similar prices.

That's what I responded to.

We all know that there's no contradiction or surprise on the question of profit because the companies have different volumes and cost structures - except maybe Sausca who thinks it can only mean one of two things.

Modified by Calhon at 10:47 PM 1-31-2010

 

Re: Volvo 2009 results - BMW comparison (tolis)

Okay, here's my take after thinking about the revenue/car comparison a bit more.

One would have expected BMW to have the higher revenue/car for at least two reasons: BMW has expensive high-end models for which there are no Volvo equivalents; and equivalent BMW models are generally more expensive. Both are negatives for Volvo w.r.t brand perception/prestige.

Despite the above-mentioned high-end models, BMW has a much higher proportion of its low-end models in its sales mix than Volvo. The 1 and 3 Series account for nearly 60% of BMW global sales; while the C30, S40, V50 and S60 combined are only about 40% of Volvo sales. That's a plus for Volvo, and probably why it ends up with a higher revenue/car than BMW ... assuming the revenue numbers are actually directly comparable.

The big negative for Volvo, of course, is that it's not selling enough cars in total.

 

The BMW calculations in the original post are not accurate, so the notion of Volvo having higher revenue per vehicle sold is bunk.

Refer to http://www.autonews.com/apps/p...99950

Core BMW brand sales were 1,068,770 with revenue of 43.74 Billion Euros. That makes an average of 40,925 Euros per vehicle.

The GROUP sales (which include Mini and Rolls Royce) were 1,286,310 with revenue of 50.68 Billion Euros. The group-wide average is 39,400 Euros per vehicle.

Convert the Euros to US Dollars, and compare to the Volvo figures, and you'll realize the picture isn't quite as rosy for Volvo as it originally appeared.

 

Re: Volvo 2009 results - BMW comparison (02s60t5)

Quote, originally posted by 02s60t5 »

The BMW calculations in the original post are not accurate, so the notion of Volvo having higher revenue per vehicle sold is bunk. Refer to http://www.autonews.com/apps/p...99950 Core BMW brand sales were 1,068,770 with revenue of 43.74 Billion Euros. That makes an average of 40,925 Euros per vehicle. The GROUP sales (which include Mini and Rolls Royce) were 1,286,310 with revenue of 50.68 Billion Euros. The group-wide average is 39,400 Euros per vehicle. Convert the Euros to US Dollars, and compare to the Volvo figures, and you'll realize the picture isn't quite as rosy for Volvo as it originally appeared.

Thank you,
That's make a bit more sense...

...and there are statistics...

If numbers do not jive with the common sense, I question the numbers first...

 

Re: Volvo 2009 results - BMW comparison (02s60t5)

The article says:

"Unit sales at BMW group, which includes the BMW, Mini and Rolls-Royce brands, fell 10.4 percent to 1,286,310 in 2009. Sales at BMW brand were down 11.1 percent to 1,068,770 cars.

BMW said 2009 group revenue fell 4.7 percent to 50.68 billion euros ($71.2 billion). Revenue in its core automobiles segment fell 10.3 percent to 43.74 billion."

When it says "core automobiles segment", it includes all the brands in its automobile sales (BMW,Mini,Rolls Royce), not only BMW brand
When it says group, it includes motorcycles and other activities financial, real estate etc....
So there is no misperception. Please be more careful when you reply with such a definite way.
I must add that the article does not mention if the revenue from its core automobiles segment is in euro or dollars.
I suppose they are in Euro. If that's the case then we get to a 34004euro/ca for BMW or $47000/car compared to Volvo's $37000. But the vast majority of Volvo sales comes from Sweden, the US and the UK, countries with very weak currencies against the euro. BMW sales comes primarily from Germany that uses the euro, so the facts are not comparable in dollar or euro terms. We should know the mix of sales....
If the number is in $, then it's as I mentioned at my first post.

 

Re: Volvo 2009 results - BMW comparison (tolis)

É must add that the article concerning BMW has been modified as they have seen the currency problem at Autonews. When I posted the article all the numbers were in US dollars. I have searched for this many times as I could not believe myself for my results.
The new article with corrected currency is the one that you judge. They claim that the last update was on last Friday but that is not true.
Here is the corrected article:
http://www.autonews.com/apps/p...99950

Apart from that there had been 4 comments at the article concerning Volvo, the last of them mine, talking about the results I posted in my first post concerning both BMW and Volvo and making the same comparison.
Suddenly all these comments for the article disappeared.....
http://www.autonews.com/apps/p...98320
You can see by yourselves that now there in not even one comment left....
They have seen the mistake and they have corrected the BMW article and at the same time they deleted my comment at the Volvo article.
When Autonews make such mistakes and delete comments in order not to show their incompetence, then what can I do?