I am sitting here writing this blog from the Volvo factory in Gothenburg Sweden and you may be wondering why Olaf is kissing this XC70. If you pay attention in the movies, you will notice that there is not a more popular car in the cinema, than a Volvo. The Volvo is a safe car. The Volvo is a luxury car, and now the Volvo is a Chinese car. However, there is nothing more quintessential Swedish than a Volvo, well maybe except IKEA. There is also no other car that Olaf would rather own than a Volvo. But none of these reasons are why Olaf is kissing it.
This week, one of our business stops in Sweden was to pick up a new Volvo at the factory. Why would you go over to Sweden to actually pick up a car? Volvo has a very nice overseas delivery program where you order your Volvo at your dealer. Volvo then flies you to Sweden for two, you get two free nights in a hotel, you get license and insurance to drive the car in Sweden for a few weeks, and you get shuttled around Gothenburg Sweden. You can even get a tour of the Volvo plant here, although the only thing my children remember from last year’s tour was the interesting Chinese-Swedish-English accent of the tour guide. It was not something heard in South Dakota very often and it amused my kids. The welding robots….? What welding robots, they didn’t notice them. Oh well…so this year we skipped the tour and let the children sleep in at the hotel. Six weeks later, the car will arrive at your dealer just as if you had ordered it. All this and you get a significant discount on the car. Last year over three thousand people did exactly what we did.
I’ve explained this to people and they look at me like it must be some sort of joke. ‘There must be a catch’ they say. Another popular question they ask is ‘how do you ship it home?’ Well there is no catch and the car is shipped home on the same boat it would be shipped ‘home’ if you just bought it normally. The way this works is the simple economics of tax loopholes, and despite what the liberals say, every American loves tax loopholes, especially if they can participate (the ones they hate are the ones other people get and they don’t). The good ole USA does not charge import duty on a used car, Sweden does not charge VAT on a car exported within six months of manufacture. You know what they say about a new car, it loses 15% of its value the moment you drive it off the lot. The same holds true here. What exactly is a ‘used car’? One in which you’ve drove off the lot. In this case, thirty feet off the lot.
These cars make Volvo more money as they price out the costs of the travel and keep the difference and there is nothing better to promote brand loyalty than a VIP experience at the factory. Now if this can be done for cars, one would wonder if this is done by GE or Exxon on capital equipment? German forged steel and industrial cracking units arrive for the oil industry in Duluth Minnesota every once in a while and one wonders if they are exploiting a similar loophole in our tax laws? Exploring the goofiness of our tax system is too much for this blog to tackle, so we’ll just let this thought go as that.
How much better would Ford or Buick do if you had a VIP tour of Detroit after picking up your new Taurus or Chevy Tahoe? Although a more realistic thought hits me. Would getting a free trip to Detroit have any valued added allure to a new Buick? It actually might be a bad thing for the American car companies since Detroit is not a Mecca for tourism, or at least that is the perception. When we think of Sweden, we think of hot blonds, beautiful forests, sailboats, smorgasbords, castles, hot blonds again, clean cities, polite people, and red houses. Did I mention the blonds? When I think of Detroit, I think of crime, corruption, Devil’s night, urban decay, and I guess Motown music. I’m not even sure if the Motown sound even happens anymore, at least in Detroit. Maybe Detroit wouldn’t have let itself go if thousands of Buick and Ford buyers would show up every year to look at their new car? I don’t know but it is an interesting thought. The only other European car company with a significant overseas delivery program is the BMW in Munich. Although I have never bought a BMW, but I hear it has a nice overseas program that does wonders for brand loyalty as well.
So far this is trip number four courtesy of Volvo. Last year we took our car on a thousand mile Midsommar tour of Gotland, an island out in the Baltic that is part of Sweden. This year we are taking the train from here to Stockholm and meeting up with my ‘Swedish sister’, Kajsa and her family for the Midsommar celebration. We will be looking more at the Midsommar holiday in the next blog after Olaf sobers up, but that is a story for another installment.
Today this is all about Volvo and there is a very good reason why Olaf is kissing this car: he got a free trip to Sweden courtesy of this car. Thanks Volvo XC70! Thanks a lot.
Good driving my friends,