Positive attitude goes a long way

China's e-commerce boom is a big opportunity for Volvo, says the Swedish automaker's chief executive

Martin Lundstedt, president and CEO of Volvo Group, is a believer in creating a fun workplace.

"Think about it," he says. "We all spend so much time on work, so it must be fun. It is not only work; it's the passion."

With such high spirits, the Swedish executive appears unfazed by the current downward pressure in China's economic growth.

"We've a very thrilling vision about the future, for we are seeing very positive changes."

Lundstedt, a 24-year veteran of the auto industry, says the Chinese government's growing emphasis on green initiatives, sustainable development and innovation are bringing great opportunities for Volvo.

The Gothenburg-based company, which has been in China for more than 20 years and makes vehicles, engines and construction equipment, now hopes to better tap the country's booming e-commerce business.

Lundstedt recently spoke to China Daily. The following are edited excerpts from that interview.

Q: What are your business strategies as you readjust to the new normal in China?

A: We're adjusting as we go. China is changing from an investment-based economy to one driven by consumption and green development. Currently, we're adjusting the business for the construction equipment unit. But when it comes to technology and innovation in China, nothing has changed.

Also, we're facing a super opportunity brought on by the e-commerce boom, which is fueling the demand for modern logistics. E-commerce will drive the entire transport system forward, setting a high demand for punctuality. China has a very strong agenda on public transportation. Basically, we have three flows in a city - the mobility of people, and goods in and waste out. We're working to use the same solution and infrastructure to move the three flows forward.

Any plan to set up new joint ventures in China?

We're committed to staying and growing in China. Building strong partnerships with our local counterparts is a win-win strategy. Regarding our joint ventures in the transportation and construction equipment areas, we are helping them with our global resources and competitive advantages to achieve success both nationally and internationally.

We already have a strong business presence in China. The current priority will focus more on how to tap the potential of utilizing our strong alliances with business partners, customers and other stakeholders to achieve a resilient development in the Chinese market and contribute to regional development plans, such as the Belt and Road Initiative.

How do you deal with competition in China given that local players have long dominated the domestic commercial vehicle market?

As you say, the segment for heavy-duty and middle-duty vehicles in China so far has been dominated by domestic brands. But the e-commerce boom and increasing commercial flows will completely change the time factor, and quality will be more and more important.

As for Volvo trucks, we are not selling on costs or prices. We are selling on solutions and a life-cycle cost, so to speak. As the market is maturing gradually, our opportunities to grow will increase. Besides, we set up a joint venture with Dongfeng Motor Corp in January last year. Dongfeng Commercial Vehicle is a very strong local player.

What about your green initiatives, in view of the growing concerns on air pollution?

We want to offer the right green solution to China, not only because the government has a strong agenda on air quality, but because natural harmony is part of China's long history. The philosophical base has always been in the Chinese heritage. That's the reason why we love the country.

We're now working on an electricity project in Gothenburg, where the first route for electric buses was opened in June. The electric bus is quiet, does not have any exhaust emissions, and is about 80 percent more energy-efficient than a conventional diesel bus.

But what's more important is the system. When there is no noise and air pollution, we can have indoor stops and access to Wi-Fi. Buses will no longer just be a means of transportation. Instead, it will be an experience.

I believe a developed city is not a city where the poor have a chance to buy a car, but one in which the wealthy use public transportation. We want to be part of China's green initiatives and help drive prosperity through transport and infrastructure solutions.

What's your view on self-driving vehicles?

What we have now is the Internet Plus trucks and transport. Volvo Group has almost 500,000 connected vehicles, with very advanced onboard controlling systems, which enable communication between drivers, trucks and buses. As we go along, that will lead to autonomous vehicles, which I believe will still rely on an advanced onboard system.

We're also working on the Platooning Project, which allows a group of vehicles to play "follow the leader" on highways and pass steering, braking and acceleration control to the lead vehicle, so that drivers can relax and do other things. The technology is ready, and we're doing full-scale tests on that.

In the foreseeable future, full self-driving vehicles will be needed in mining areas and remote regions where it is difficult to find employees. But there are issues on safety standards.

What do you think is effective leadership?

Volvo Group is a great company with tremendous assets in terms of brand and people. After joining the group, I have found this organization has deep knowledge about our products and customers. It's very clear we will increase our focus on customers and contribute to driving our business with higher speed and improved efficiency. We need to trust our people and carry on the work with passion - and have fun.

What are your hobbies?

I tend to spend my limited free time with my family, and I enjoy playing music and going sailing along the east coast of southern Sweden, where I can embrace nature.

masi@chinadaily.com.cn

(China Daily European Weekly 05/13/2016 page31)