Slow Production Ramp-Up Delays Volvo C70 Sales

NEW YORK – A deliberately slow-paced production ramp-up at its Volvo Car’s Uddevalla, Sweden, plant is slowing sales of the ’06 C70 at U.S. dealerships.

With 1,800 pre-orders in the bank, Volvo is attempting to deliver its latest version of the eagerly awaited 4-seat convertible to customers.

“But we don’t want to ramp up too quickly,” Volvo CEO Frederik Arp tells journalists here, noting Volvo dealers already have pre-sold the first year’s production.

Arp says Volvo and its manufacturing partner, Italian coach maker Pininfarina SpA, want to assure themselves C70 quality is optimized before ramping up to full production.

“The C70 is in the forefront of innovation with its 3-piece folding roof,” he says. “That’s why we drive and inspect all cars” rolling off the assembly line.

Despite this careful inspection, Volvo discovered a fitment problem with the driver’s side window in an early shipment of C70s reaching the West Coast. It was allowing water to get into the passenger cabin. Volvo quickly fixed the problem at the port before any vehicles were delivered to customers.

'06 Volvo C70 convertible

By May 10, Volvo dealers delivered the first 100 cars received here, and Volvo Cars of North America says it expects to deliver all 1,800 of the pre-sold cars by the time ’07 models begin arriving here in July.

VCNA forecasts it will sell a total 5,700 C70s this year and about 10,000 units next year.

Base price for the C70 is $38,710, with an additional $695 delivery charge for a model with a standard 6-speed manual transmission. A VCNA spokesman says the company expects the average transaction price to be about $42,000 with a premium package and an automatic transmission.

Arp says Volvo will sell 12,000-15,000 C70s worldwide this year and approach 20,000 units in 2007. Pininfarina Sverige AB manufactures the C70, in a joint venture between Pininfarina SpA and Volvo, with Pininfarina as the majority stockholder.

Arp is confident the second-generation C70 will avoid the production delays and poor quality issues that plagued the original version, which was built by AutoNova, a JV between Volvo and now-defunct U.K.-based engineering specialists and contract-builder TWR Engineering Group Ltd.

After many delays, the first C70 debuted about a year late and still had serious cowl-shake defects that took several years to eliminate. Volvo eventually bought out TWR and revamped the entire production operation to achieve high quality C70s. But the car never met its sales targets.