Volvo Car Corporation is one of the many leading brands of car manufacturers that have been in the

market for quite some time. Unlike a lot of car manufacturers who tend to operate in niche pockets,

Volvo caters to a global audience. In this paper, the concentration will be on the major challenges that

the Volvo Car Corporation tends to face in the European Union area. In the last few years the company

has been plagued with issues related to research and development as well as marketing and sales. These

two problems are related to each other and have thus given to many other problems as well.

One of the biggest challenges that the Volvo management tends to face in the area of its operation in

the European Union is that the governments as well as the governing bodies of the Union are very strict

and stringent about their allegiance towards cutting carbon dioxide emission that tend to come from the

car. Here is the percentage wise breakup of the contribution to the carbon dioxide emissions in 2014.

Imghttp://www.crp-eut.org/2014_Samuelsson.pdf courtesy –

The EU is very particular about this issue making it mandatory for car manufacturers to comply with

their rules and norms regarding the issue. However, the Volvo management tends to complain of a

regular non practice for innovation in the car technology space. There is a series lack of automotive

research and thus has hampered the company’s prospects to a very great extent. In a statement given

by Stefan Jacoby, President and CEO of Volvo Car Corporation, he mentions “Volvo Car Corporation

urges the EU to coordinate incentives whilst supporting research and development. The European

automotive industry risks losing the present technological leadership if this do not happen”. This fear is

not unfounded and thus the management feels that making it mandatory for the cars to be electrified in

order to reduce the carbon emission requires to be done in phases. The company does not have the

required time for the research and the expertise needs to be developed. On the other hand the EU is

unwilling to compromise on this issue.

In conjunction with the above mentioned problem, there is another issue of marketing and sales that

has been bothering the company. The auto giant is facing stiff competition from other players operating

in the same sphere in the market. Some of these has already developed the technology of electric cars

wherein the amount and rate of the carbon emission is quite less and in adherence to the limit

prescribed by the EU.

In this paper, we shall see how the new global marketing strategy can help the company to bring itself

back to its former glory. The paper will explore various options regarding the EU’s stand on the

reduction of the carbon dioxide emissions and the various options that Volvo cars have in the near

future that they can exercise to stay put in the European markets and tackle completion in the market as

well. These options are changing the branding strategy of the cars and even exploring the social media

and the online marketing channel to penetrate the market and reach the audience better.

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