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Volvo uncovers widespread cheating by its Chinese dealers

According to a report in Reuters, the findings of an internal investigation conducted by Geely-owned Volvo is that its Chinese dealers vastly overreported their sales numbers in 2011, then even more vastly underreported their 2012 sales figures. About "half the dealers" out of the 151 total outlets gamed the system in order to get incentives for reaching volume objectives, falsely recording about 7,000 more units sold than was actually the case. Instead of 47,140 cars sold in China in 2011, the real number should have been 39,871.
Volvo corporate books a sale once it ships a car to a dealer, so that meant there were 7,000 more cars in inventory than there should have been. To restore the balance, the dealers underreported their 2012 sales while they unloaded those extra cars since, naturally, they couldn't claim the sale again. That made it look like sales declined by 11 percent in 2012, even though they actually increased year-on-year. The adjusted sales number for 2012 totalled 45,896.
Volvo has met with its dealers and told them to stop the deceitful practice. The discrepancies weren't so great that the company plans to restate its historic numbers, but from now on, it apparently plans to occasionally check inventory to make sure the numbers match and that it has a true picture of how individual models are selling.

Weekly Recap: Lincoln Continental serves up the style, Cadillac CT6 delivers the substance in New York

Lincoln and Cadillac grabbed the spotlight this week at the New York Auto Show in a dramatic fashion that evoked the brands' glory days. America's two luxury carmakers went toe-to-toe with their glittering reveals and plans for ambitious expansion. Both were selling their technology, style and the promise of a better future. Cadillac vs. Lincoln. At the Javits Center, 2015 seemed a lot like 1956. Neither company was interested in drawing comparisons with the other, which is fair, and accurate. They're in vastly different places in terms of sales and the pace of their turnarounds, but they hope to reach the same eventual destination at the pinnacle of the luxury-car world. Lincoln used the element of surprise to great effect with the Continental concept. A production version is still at least a year away, and the company was vague on details. Officially, we don't even know if it is front- or rear-wheel drive, though speculation abounds. Who cares? The seats can be adjusted 30 ways! The Continental also showed off a bold chrome grille that will be the new face of Lincoln. The blue bomber also rolled on blinged-out 21-inch polished aluminum wheels, used a 3.0-liter EcoBoost engine and had huge LED head lights with "laser-assisted" high beams. All of this resulted in almost blinding attention. The concept drew rave reviews, stirred controversy with Bentley designers who argued Lincoln ripped them off, and most importantly, pointed a way forward for the newly determined brand that hopes to compete with Mercedes, BMW, Audi, Cadillac and Lexus. View 32 Photos Meanwhile, Cadillac showed the CT6, a finished product that will top its range and is loaded with the best and latest technologies General Motors has at its disposal. With production starting late this year, Cadillac had more specifics at the ready. Engines? Cadillac has a couple V6s and a turbo four for sure. It's working on a hybrid, and has considered a V-Series variant. It's based on a new rear-wheel-drive, aluminum-intensive chassis called Omega, features an advanced collision-mitigation system with automatic braking and has a cabin that's laden with "leathers, exotic woods and carbon fiber." It will be assembled at GM's Detroit-Hamtramck factory and goes on sale next year. At this point, Cadillac is more than willing to talk about every except for the price. The devil was not in the details for Cadillac, as evidenced by the CT6. But it wasn't for Lincoln either.

Volvo returns to profitability

Ford sold Volvo to Zhejiang Geely Holding Group Limited in 2010. Just two years later, Geely announced an $11-billion investment in the Swedish carmaker, its charismatic fugleman Li Shifu saying, "We want to revive Volvo and give the brand its strength back." Two years later, after having introduced the Concept XC Coupe at the Detroit Auto Show this week, Volvo CEO Håkan Samuelsson (above, second from right) declared the company profitable again after a solid 2013 and predicted a positive 2014.
Intending to break even on operating profit in 2013, Volvo exceeded expectations and landed on the plus side due to a mix of factors. US sales declined 10.1 percent for the year to 61,233, that number still making us Volvo's largest market, but Chinese sales were up nearly 46 percent to 61,146 units, and even its home market saw a bump of 0.8 percent; total sales for the year were 427,840, a margin of 1.4-percent over the previous year. Volvo was able to do more with the tiny gain and reverse its half-year operating loss because of a global cost restructuring and thorough revamp of its Chinese distribution network. An announcement of 2013's financial results will come in March.
Bullishness on 2014 comes from the company's intention to focus on its two biggest markets with new models, new technology and more spending. The first product of an independent Volvo, the new XC90, will be revealed later this year on the new SPA architecture. On top of the Sensus Connect infotainment system, Volvo will add driver-aid systems like adaptive cruise control with steer assist and night-time pedestrian detection. It also has a new North American CEO and will spend more on marketing and communications here. In China it will begin to feel more effect from the two Chinese factories opened last year - it has three in the country - and, if need be, can take advantage of more advantageous exchange rates by exporting from China instead of the US. Said Samuelsson of what he expects in the US in 2014, "we will outperform the market."