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Volvo: Finding True Values in The Electric Bus Market

Volvo is considering entering China's growing electric bus market to address environmental issues and collaborate with China's policies. China has over 1 billion people, most using buses, and plans to replace gasoline buses with electric ones. Volvo could become a leader in electric buses and capitalize on China's large market and government support for electric vehicles. Applying a true cost analysis, electric buses provide the lowest total ownership costs. Volvo already sells over 300,000 vehicles annually in China, whose market is growing.

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Anik Guin
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176 views8 pages

Volvo: Finding True Values in The Electric Bus Market

Volvo is considering entering China's growing electric bus market to address environmental issues and collaborate with China's policies. China has over 1 billion people, most using buses, and plans to replace gasoline buses with electric ones. Volvo could become a leader in electric buses and capitalize on China's large market and government support for electric vehicles. Applying a true cost analysis, electric buses provide the lowest total ownership costs. Volvo already sells over 300,000 vehicles annually in China, whose market is growing.

Uploaded by

Anik Guin
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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VOLVO

Finding True Values in the Electric


Bus Market

S2_C2_T5
VOLVO B
Mission
To offer safe, clean, and efficient transportation around the city
A
or across the continent.
C
Vision
To become the world leader in sustainable transport solution
K
and address social, economic, and environmental responsibility.
G
• Founders: Assar Gabrielsson & Gustaf Larson
R
• Headquarters: Gothenburg, Sweden
• Originally incorporated as a subsidiary of Swedish ball O
manufacture in 1915, eventually pursued car construction in
1924. U
• In 1928 Volvo introduce buses which became known for their
safety and quality.
• In 2008 Volvo built its fast hybrid electric bus prototype( the
N
B5L Hybrid) and launched it in 2010.
D
VOLV M
O is a multinational manufacturing company for automobiles
• Volvo
• A world leader in commercial transportation technology.
A
• Volvo manufactures buses trucks and construction equipments. N
• From 2000 to 2014 Volvo’s heavy vehicle group’s net sells increased by 117%
U
F
80
Volvo net sales 2014 A
60 C
40 T
20
U
0
R
I
N
G
KPMG’s True Value Methodology

ECONOMICS ENVIROMENT EQUITY

• True value methodology of KPMG assessed a company’s true earnings


by identifying and quantifying its externalities.
• This was implied by firms to understand future earnings at risk.
• This helped firms to develops business cases that capture value
creation opportunities.
• This help in reducing risk.

The steps of this methodology are-

1. Assess the company's true earnings.


2. Understand future earnings at risk.
3. Create corporate and social value.
China’s emerging Electric Bus industry
• A fast developing nation with the largest population in the world.
• Chinese government had taken steps to address smog and pollution as
part of its energy policy.
• only 6% of the population owns a vehicle.
• Majority of the remaining 1.6 Billion Chinese use buses.
• Around 1.5 million buses are in operation today.
• An opportunity for 190000 new buses to be manufactured each year
• in 2014 China acquired more than 90% of total revenue for 8 electric
bus company.
• forecast that by 2020 China will account more than 50% of global
electric bus market.

Sweden

China
Government Promotion of Electric Vehicle in China
• Chinese government along with other organizations invested more
than $1.79 billions to carry out new energy vehicle research and
development
• China launch the Thousands of Vehicles, Tens of Cities (TVTC) pilot
program.

Volvo’s Chinese Competitors

FAW Ankai
BYD Group Automobile

Zhengzhou Zhongtong
Yutong Bus
Group
Why Skarsgard considered entering bus market of China
• Electric buses are the answer to growing smog and pollution by
?
gasoline and diesel vehicles.
• China is an emerging market with a population of 1.435 billion
• The true value method can collaborate with the policy of Chinese
government .
• Being the primary producer of electric buses Volvo can become
successful in China.
• Electric buses were the only technology that saw a reduction in the
cost of ownership when TrueTCO calculation was applied.
• In 2010 Volvo sold 373525 vehicles with sells rising 36% in China.

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