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Volvo Poised to Double Parts Storage Capacity
Summarize：The world's leading commercial vehicle maker Volvo is expected to double the size of its parts storage in China as demand booms.
Volvo's wholly-owned Volvo Parts (Shanghai) Co Ltd now has a 4,600- ...
The world's leading commercial vehicle maker Volvo is expected to double the size of its parts storage in China as demand booms.
Volvo's wholly-owned Volvo Parts (Shanghai) Co Ltd now has a 4,600-square meter warehouse in Shanghai Waigaoqiao Free Trade Zone in addition to an adjacent 1,000 square meter area.
The company plans to expand a further 1,800 square meters in Waigaoqiao area in northeast Shanghai from April and another 5,000 square meters coverage is also under consideration, said Volvo Parts general manager Lu Zhonghang.
"China is a strategic market for Volvo worldwide thanks to its unexpectedly strong growth," said Lu.
The parts company in Shanghai is Volvo's third largest parts base in Asia. Lu said it boasted an advanced and effective management system.
It supplies 14,000 kinds of parts mainly for Volvo trucks for the domestic market in addition to marine engines, and industrial engines and construction equipment.
Volvo Parts (Shanghai) reported its sale revenue had increased nine-fold to several hundred million yuan last year compared to 2002 when it started operation. Annual growth averaged at 50 percent, Lu said.
"In the future, expansion of the warehouses also serves Volvo's ambitious sourcing plan from China to the global market," Lu added. China's booming economy has created a huge demand for trucks in logistics and construction industries.
Sales of commercial vehicles climbed 22.25 percent to hit a record high of 2.49 million units in China last year.
"A well-developed after-sales service is crucial to maintain competitiveness in a market 90 percent dominated by Chinese peers," said Niu Jigang, auto analyst from Debon Securities Co Ltd.