Editorial

Volvo Crashing

What is a Volvo? Editor At Large Jay Traugott wonders because the automaker no longer builds ugly cars that are extraordinary safe. They're now just very safe cars without a clear future.

What is a Volvo? Besides the commonly known fact that it is an automobile, the Swedish automaker has long been synonymous with safety. In a previous era when government regulations throughout the world were not at the level they are today, Volvo was ahead of the times. But what relevance does it have today? With models such as the classic 240 sedan and wagon, buyers were primarily concerned with their safety and sacrificed styling for something that looked like a brick with wheels.

Reasonable enough because Volvo developed some of the most important safety features of the 20th century. Examples include the safety cage, windscreen washers, the modern 3-point safety belt, padded dashboards, the rear-facing child seat, and the first head-protecting airbag. The list goes on. At some point, every automaker adopted or developed their own versions of these pioneering innovations. Is it even possible to imagine modern cars not having this stuff? Now we're in an era of strict safety regulations that automakers must abide by. So is Volvo's once revolutionary innovation still relevant?

To answer this, a bit of background history is needed: Volvo sold off its automotive manufacturing division to Ford in 1999 in order to focus their efforts on commercial vehicles such as buses and large trucks. Ford saw an opportunity because of Volvo's vast engineering capabilities. More specifically, they wanted a mainstream luxury European brand for their Premiere Automotive Group, which already included Jaguar, Aston Martin, and Land Rover. Ford quickly expanded Volvo's product range with new models such as the S80 sedan and the XC60 crossover.

Basically, Ford wanted a viable competitor to foreign brands such as BMW, Mercedes-Benz, and Audi. Did this really pan out? Not exactly. Combined with an economic downturn and a lack of styling, Volvo quickly began losing money. Still, Ford was able to access solid platforms for models like the Five Hundred (now the Taurus) and the new Explorer. Both are based on S80 underpinnings. When Chinese automaker Geely bought Volvo from Ford in 2010 for $1.8 billion (Ford bought it for $6.45 billion in 1999), they envisioned turning it into a luxury brand to compete (once again) with BMW, Mercedes-Benz, and Audi. Sound familiar?

Geely owner and founder Li Shufu publicly stated that he wanted to move Volvo in this direction. Stefan Jacoby, who came from Volkswagen to be Volvo's CEO, didn't agree with his new boss. The two clashed on whether to build larger and more luxurious cars. Jacoby won and Volvo announced they won't be building an S-Class/7-Series-sized competitor in the near future. His solution was to emphasize the brand's safety heritage. That sounds all nice and good, but times are very different now than they were 50 some years ago.

One of the best-selling cars in the US, the Chevrolet Cruze, has received a five-star crash rating from the National Highway Traffic Safety Administration and comes standard with 10 airbags. The point is that all automakers now follow and often surpass government-imposed standards that make cars the safest they've ever been. Volvo will still continue to develop safety technology, but in this era they're not alone in attempting breakthrough innovations. So the question remains: What is a Volvo? Is it sleek and modern with IKEA-like Swedish styling or the preferred choice for yuppies with young kids?

Neither are enough to survive in the long term. Volvo and its new Chinese owner will need to find a way to replicate their past in order to remain competitive in the future. Otherwise they'll be nothing more than contemporary Swedish design surviving a serious crash.

Latest News

SEE MORE ARTICLES