Thu, 03 Apr 2008
Until 2005, Volvo was portrayed here as a legitimate representation of high-ranking government officials as well as of persons of a certain social status.

Things changed for Volvo about three years ago, when the government started to shift to relatively cheaper cars, dominated by Toyota's Camry, as official government vehicles.

Armed with a new positioning strategy, the brand hopes to regain its position and boost this year's sales by almost 200 percent to 170 units from 60 units last year.

"The luxurious Volvo S80 will be our sales' backbone this year," said Paulus B. Suranto, CEO of PT Indobuana Autoraya -- Volvo's official distributor -- at the official launch of the car in Jakarta on Wednesday.

The company, Paulus said, was targeting to sell 120 units of the Volvo S80 and 50 units divided between the S60 sedan and the sport-utility vehicle XC90.

In 2005, Volvo sold 143 cars in Indonesia. That number decreased in 2006 to 69 cars. In 2007, the number dropped again to 60 cars, or only 0.01 percent of the 433,323 total cars sold in Indonesia last year.

Jusak Kertowidjojo, the CEO of Indobuana's parent company, Indomobil Group, acknowledged that being the government's car of choice for years had helped to boost Volvo's image as a mark of class.

Prior to the shift to the Toyota Camry in 2005, Volvos were used by almost all high-level officials, from heads of state departments to members of the House of Representatives and high-ranking military officers.

Instinctively, other prominent segments of the community, like private company directors, were influenced to drive a Volvo.

However, Jusak denied the government's decision to abandon Volvo had anything to do with Volvo's declining share of the Indonesian market.

"Volvo's biggest costumer segments are in individual and company markets, not the government. Thus, the government's decision did not have a significant impact on our sales," he said during the launch of the new Volvo S80 on Wednesday.

Paulus said the reason for Volvo's sales decline was mainly due to the decision by Volvo's headquarters in Sweden not to make Indonesia one of its main markets.

"Volvo is still focusing its sales in the United States and Europe, where the demand is very high. Thus, Volvo does not have a large supply to be sold in Indonesia," Paulus said.

The Volvo S80 type, with a 2500cc engine, can be ordered for an on-the-road price of Rp 750 million (US$82,000), while the 3200cc variant costs Rp 1.2 billion. (uwi)



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