NINGBO, China (Reuters) - China’s Zhejiang Geely Holding Group Co Ltd [GEELY.UL] and its Volvo Cars unit are considering making Lynk & Co branded vehicles at Volvo plants in Belgium and the U.S. state of South Carolina, a senior Lynk & Co official told Reuters on Wednesday.
The Lynk & Co brand is jointly owned by Geely and Volvo Cars, and sales of the vehicles began on Tuesday in China. Sales are scheduled for 2019 in Europe and 2020 in the United States.
The start of Lynk & Co sales caps a decade of preparation by Geely to improve its prospects in a local marketplace dominated by global automakers, and expand abroad. To that end, Geely’s founder and chairman, Li Shufu, bought Volvo Cars in 2010, giving it access to Volvo’s engineering know-how.
The first model is the 01 compact sport-utility vehicle (SUV) with a starting price of 158,800 yuan ($24,054). It is made on the same assembly line as Volvo Car’s XC40 crossover SUV at a new Volvo-operated plant in Taizhou on China’s east coast.
Lynk & Co cars will also be built at a plant in Zhangjiakou in China’s north-east, beginning some time next year.
The automakers are considering building Lynk & Co vehicles at Volvo Car factories in Europe and the United States, Lynk & Co Senior Vice President Alain Visser said in an interview.
“We have always said our manufacturing footprint will be global, and it will. It’s obvious that we are talking to Volvo to see whether there are opportunities within the small network of Volvo plants” to produce Lynk & Co cars, he said.
Volvo Cars’ factory in Gent, Belgium, is “an option we are looking at,” as is a Volvo plant under construction in Charleston in the U.S. state of South Carolina, Visser said.
“A decision hasn’t been made for those plants. But we are looking into that,” he said.
Lynk & Co sales began in China with plans for only a limited network of franchise showrooms in city centers and larger dealerships in suburban areas. The intention is to sell more cars online.
The brand will also experiment with a subscription model where “people, just like with mobile phones, can subscribe for a month, 10 months, 20 months for a period of time, so you don’t just buy a car, you buy mobility,” Visser said at a media event on Tuesday in Ningbo, eastern China.
Lynk & Co cars will initially have petrol-powered engines, with plans afoot for petrol-electric hybrid, plug-in hybrid, and all-electric versions of the 01 and future models.
Under consideration for Europe and the United States is the sale of electrified versions only, sold directly without the traditional dealer-based distribution network, Visser said.
Lynk & Co cars’ sales target is half a million vehicles a year in China, Europe and the United States by 2021 with five to six models, he said.
Reporting by Norihiko Shirouzu; Editing by Clarence Fernandez and Christopher Cushing
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