Volvo To Stop Factory Support For Racing

Volvo made some ripples last week with a couple of announcements likely to have various parties feeling just a little bit nervous.

Decision 1 will effect anyone involved with a factory-backed Volvo racing team – unless they’re in a boat. Volvo’s global Marketing Manager, Alain Nisser, was quoted in the press last week saying that the company will cease direct participation in racing. Volvo’s sponsorship of ocean racing will continue, but car racing is on the chopping block.

VolvoPolestarV8Volvo support efforts by their performance partner, Polestar, in several racing series around the world, including the Swedish Touring Car Championship and the Australian V8 Supercar Championship. Polestar has won the last two STCC titles and won four races in the Australian series, in just the team’s second year.

Polestar will have to make decisions about their continued participation in some series’ if they’re going to have to fund their own efforts fully through competition and sponsorship in the future.

From an Australian perspective, this would be a major disappointment. Volvo and Polestar’s inclusion in the V8 Supercar series via the Garry Rogers Motorsport organisation (GRM) has created plenty of interest. Mercedes and Nissan joined the series – dominated by just Holden and Ford for two decades – but neither have had the success of Volvo. GRM Volvos took pole position in 10 out of 38 races this year, winning four of them.

Volvo’s contract with V8 Supercars runs until the end of 2016. The STCC contract finishes a year earlier.

The big question is WHY?

There are two reasons – the one that sounds a little bit warm and fuzzy, and the real reason.

Warm and fuzzy, by Alain Visser:

“Motorsport does not conform with our brand, where we stand for smaller engines and safety,”

The real reason, by Hakan Samuelsson, CEO of Volvo Cars Group:

In the end, we do it if we think we can make money from selling more cars.

Follow the money, as they say in the classics. It costs money to race and unless you’re making it back somewhere, the cost is going to come under scrutiny. In Australia, Volvo has been racing for two years with some considerable success, yet their sales in 2014 are down 7% year-to-date. Sales were down a whopping 37% in November.

Samuelsson did actually echo the warm and fuzzy quote a little, when he went on to say:

Long-term it’s not really the cars we will be producing so it’s on the negative list, but let’s now continue the contract we have. Long-term it would be more interesting [to] maybe look into a hybrid formula. That’s open for discussion but there’s nothing I’ve heard about.

The good news is that the V8 Supercars group will be altering the rules for 2017 – the year after Volvo is due to quit racing in Australia – and the new rules will allow for classes other than V8s. Maybe there’ll be something there that will suit Volvo’s future vehicle plans a little better.

Volvo and Polestar have won a lot of friends down here in Australia, even if those friends haven’t bought cars yet. Racing is an investment and all good investments take time.

Here’s hoping Volvo might choose to stay around.

I’ll get to Decision 2, which concerns Volvo’s marketing plans and dealers, tomorrow. For now, here’s 8 minutes of the most exciting racing from the V8 Supercar Series this year. Take the time to watch it.

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6 Comments

  1. I like the new look. Too bad about Volvo and racing. I wonder if all racing is headed this direction? The cost is huge in most cases, and does it really sell more cars for the OEM sponsor? Good questions to ask.

  2. Here’s the thing. If your aim is to make money, the last place you want to go is the auto business. I don’t care what level you’re at–manufacturing, retail, repair…..the return on investment is not good. So why does anyone get into this business? Because we love cars. Cars are fun. Cars are sexy. Cars and racing are even more fun, even sexier. My beef with Volvo is that they have the world already convinced they are safe, they are sturdy, they are comfortable. They haven’t convinced too many people that they are fun. Given that there are more and more cars which are fun, and also safe and sturdy, Volvo needs as much fun credibility as it can muster, and isn’t that where racing can help?

    1. I’m all for more racing, Pierre. Bring it on. I think every manufacturer should be in on it.

      The trouble is cost. The successful car companies make enough out of their business to justify adding some lustre. Those on the margins? That’s a tougher call. That’s Volvo’s position right now.

      I really hope they stick with it.

  3. This love/hate on/off relationship between car manufacturers and motorsport is interesting… But I do understand the reasoning from Volvo. The car industry is changing for real, and I think it is difficult to promote stuff like hybrid tech, electric drivetrains, and electronic safety features in the most of the motorsport series today. F1, Formula E, and LMP1 – partly yes. But these are very expensive series without a bearing on consumer cars. Otherwise there are no strong connections with new consumer trends shaped partly by new binding government regulations on fuel efficiency, emissions, and safety.

    There has also been a problem the last 10 years or so in many “smaller” series (like touring car racing) that one manufacturer go all-in and totally dominates a specific series. Then other manufacturers stays away and maybe only give minor support to private teams. When the participating manufacturer have won everything without having any real competition, they change some regulations in the series. The winning manufacturer quits, saying that it has done what it set out to do. Then another manufacturer enter the scene, form their factory team, and the process is repeated. WTCC is a prime example of this. It ruins the interest from the public and it also makes the successes on the tracks not really worth that much.

    IMHO, STCC is a joke today. What we have now is the result of a disagreement in Swedish motorsport the last few years that saw a break-away “touring-car series” formed, and then they merged to create what we now have. Not that many spectator on the race weekends, and the whole planing is a disaster with hardly any racing at all in the Summer when vacations and nice weather would make it most feasible up here. Media coverage is (as expected) bad, and the race calendar were not set even when the season started. I watch some races before the Summer but then didn’t care anymore. The whole thing looked unprofessional. I understand if Volvo don’t see the point spending money on it, and I don’t think the general car-buying public in Sweden cares at all about manufacturer participation in STCC.

  4. I cant say I’m surprised. A Volvo V8 race car seems an oxymoron when there is no v8 offered in any of their cars . I know they used to sell an XC90 with a V8 – but that was a Yamaha engine.

    I think they should bring back station wagon racing instead.

  5. I have a history of Volvo cars from 1966 to the present. I can’t say that any of them qualified as “fun” cars although I loved them all. (Although I see several that are, at Volvo get-togethers.) Also have a history of Saabs, from 1971 to 2006. They are pretty much fun cars and I will never be without one (or three). I don’t think the average Volvo owner is even aware of Polestar. Conservative is their image.