Volvo Starts Production of Best-Selling XC60 at Chinese Plant

Nov 10, 2014 01:00 PM EST | Matt Mercuro

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Volvo Car Group said this weekend that it plans to start production of its XC60 crossover at its plant in Chengdu, taking a step toward supplying locally produced vehicles in China, as well as opening the door to overseas exports.

Volvo said in a statement on Sunday the start of XC60 production would add 500 new manufacturing jobs at its plant in Chengdu, in central China, where it currently makes another vehicle, the S60L.

The XC60 is the automaker's best-selling vehicle since 2009.

"The start of XC60 production in Chengdu is the latest milestone in Volvo Cars' transformation," Volvo Cars Chief Executive Hakan Samuelsson said in a statement, according to Reuters.

"It will be instrumental in boosting Volvo's overall growth in what is now our largest market."

Growth in China has helped the automaker report 16 straight months of rising sales, though its disappointing performance in the United States remains an issue.

The U.S. was once Volvo's biggest market, but it has been replaced by China in recent years.

Volvo, which was purchased by Zhejiang Geely Holding Group from Ford Motor Co. F.N in 2010, is looking to double its annual sales to 800,000 vehicles by 2020. It wants to stake out a claim in a premium market mainly dominated by companies like Daimler's Mercedes-Benz and BMW.

"The Chengdu plant is absolutely on a par with our European plants," said Lars Danielson, head of Volvo's China Operations in a statement, according to The Wall Street Journal. "Whether it is in terms of quality, installed technology and equipment, working environment and safety or environmental performance, our plant in Chengdu matches Volvo Cars' global standards and requirements."

The Gotehnburg-based company remains a small player in the global autos industry, though it recently rolled out the XC90 SUV, its first new vehicle developed under Chinese ownership,

Volvo added that it expects to start exporting vehicles from its plants in China to the United States sometime in 2015.

The XC60 has sold more than 500,000 cars globally since it was first introduced in 2008.

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