Volvo Details $11 Billion Spending Plan

Volvo Car Group, which announced earlier this year it will invest $11 billion on new products and capacity, says about half the total will be spent in Sweden.

The company, which is owned by China's Zhejiang Geely Holding Group Co., expects to roll out the first vehicle to ride on its so-called scalable product architecture the next-generation XC90 crossover by the end of 2014.

The SPA consists of shared modules and scalable components that can be assembled on the same flexible production line. Volvo notes that shifting to the new platform will make its products "technologically independent" of Ford Motor Co., its previous owner.

The company's new Volvo engine architecture (VEA) will spawn a lineup of four-cylinder engines whose goals are to produce more power than Volvo's current six-cylinder mills while delivering better fuel economy than today's four-cylinder powerplant. The VEA engines all will use cylinders displacing 500 cc each, a size that optimizes thermodynamics, according to the company.

Volvo says its investment in Sweden will include opening a new body shop at Torslanda, updating the Olofstrom assembly plant to make vehicles designed for the new SPA platform and retooling the Skovde engine plant to produce the new modular engines.

The balance of Volvo's $11 billion budget will be spent almost entirely in China. The company hopes to multiply sales there sixfold to 300,000 units by 2020. Last year Volvo's global sales jumped 20% to 449,300 units.