Volvo, the world's second largest truck maker, expects Asia to overtake Europe as its largest market by 2015, helped by robust demand in India and China, its chief executive said. While growth is tapering off in mature markets in Europe and North America, Volvo, along with rivals Daimler AG and MAN, are increasingly turning to Asia for business opportunities.
"If everything continues as I see them today, then you can see slow development in the US and Europe and very quick growth in India and China," Leif Johansson told Reuters in an interview in Shanghai.
"Right now, Japan is still reasonably big, but the quickest growing markets are India and China. I would expect India and China to be 60 or 70 percent of our Asia sales by 2015."
As of the end of the first quarter, Asia was Volvo's second largest market, contributing to 24 percent of its global sales, according to company data.
The Swedish trucks and engineering group, which controls major Chinese gear maker Shandong Lingong Construction Machinery, would consider more acquisitions in China, where demand for construction equipment has been strong thanks to a booming economy.
"We are looking at different opportunities to grow. One of those opportunities is to grow by acquisition," said the chief executive.
Volvo, which makes heavy-duty trucks under the Renault, Mark, UD trucks and Eicher brands, also intends to expand its tie with China's Dongfeng Motor Group Co, China's number two automaker by sales as of the end of April. Dongfeng has a manufacturing tie-up with Nissan Diesel, a former commercial vehicle arm of Nissan Motor but now fully owned by Volvo.
Local production of more of its truck brands was an option, Johansson said, even though no specific decision has been made. Daimler AG operates a joint venture with Beiqi Foton Motor, while Navistar International Corp and China's Jianghuai Automobile have initially agreed to set up joint venture.