The Volvo Ocean Race has become so synonymous with the Swedish multinational manufacturing company that it’s hard to remember it was once called the Whitbread Round the World Race.
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Volvo acquired the race in 1998 and the first Volvo Ocean Race was in 2001/02. The current competition is the 12th edition, meaning Volvo have been entrenched in it for five races, almost half the event’s entire history.
The relationship between the race and sponsors Volvo has been described as a “happy marriage” since they were bound in 2001, and that bliss doesn’t show any sign of ending. These are the views of Lars Erik Forsbergh, president of Volvo Group Trucks in the Middle East, and VOR CEO Knut Frostad, who has competed in the event four times himself, twice as skipper.
Forsbergh says Volvo and the race are perfect bedfellows because sailing matches the company’s three core values of quality, safety and care for the environment.
“It’s amazing the things these guys go through, with 20m high waves, and in the last leg Team Vestas Wind had an accident, hitting the reef. Luckily they all survived so safety is most important.
“And what is more environmentally sound or clean than using the wind for sailing? So I think sailing matches very well with the core values of the company. I don’t know any other sports that would fit better into what we’re doing.”
Sport and culture have been the focus of the Volvo Group’s sponsorship since the 1970s. With its global scope, Volvo says the VOR is the perfect way to strengthen the Volvo brand and a great opportunity for the Volvo Group to establish closer relationships with customers and the general public.
“For us it’s a way to continue to build the brand image, that’s what it’s all about,” said Forsbergh.
“We are present on all continents in the world and in the race you sail around the world, you make the different stops on the different continents. The VOR is very well established, with a long list of cities around the world who really want to have a stopover. I think that’s a sign of how established it is. There’s not that many other sports that are as global as sailing.”
The race this year will finish in Gothenburg in late June. Sweden’s capital is very popular with sailors and it is also where Volvo’s global headquarters is based.
Forsbergh added: “Everyone in Sweden owns a boat. Sailing on the sea or lakes, it’s something that’s very close to the Swedish mentality. Also, if you go to countries like Brazil, South Africa, UAE and other ports, sailing and boats is also very close to the mentality of those countries.
“You have a lot of coverage of the VOR, which of course gives a lot of recognition to the sport and is excellent to build a brand. By picking sailing and the VOR, it’s a great way of promoting the Volvo brand.”
Abu Dhabi was first used as a stopover for the race in 2011/12 and Adil Khalid, a member of the Abu Dhabi boat Abu Dhabi Ocean Racing, became the first Emirati to compete in the race in the same year. It’s not surprising then that Volvo has identified the Middle East as a key market to promote the brand, with results already proving that move to be a correct decision.
Forsbergh said: “The UAE is booming. We doubled the sales volumes in 2014 compared to the previous year in the UAE so it’s going extremely well.”
The Swedish truck maker enjoyed a successful first quarter of 2014, with a 13 per cent recorded increase in forecasted deliveries across its 13 active Middle East markets. The improved figures follow the launch of three region-specific models earlier in the year: the FH, FM and FMX.
Last year Volvo moved all its commercial staff from Gothenburg to Dubai which is now the hub for the commercial side of the business, covering 15 countries.
Forsbergh added: “It’s been a good decision because you’re closer to the market, importers, closer to the reality of where things happen.
“In the UAE we are here, we are very well established with Al Futtain. It’s a very strong import area. With the growth here there are a lot of building projects planned.”
Saudi Arabia is another gem in Volvo’s Middle East crown, while Oman is also a stable market, although the company is not content to sit still and has ambitious plans for the region as a whole.
“We’re building a new production plant north of Jeddah because we have grown out of the other one. We’re also growing into new markets like Iraq which is very a difficult market, but will be a very important one. Iraq is the third biggest oil reserve in the world. OK, the money is still in the ground, but it’s starting to flow and most of the country needs to be rebuilt now after 25 years of civil war. We believe a lot in Iraq,” said Forsbergh.
Frostad, meanwhile, is in the unique position of knowing how powerful the VOR can be from both a corporate and competitive angle.
The Norwegian has unique experience and insight of the race, having sailed in four previous editions, while since leaving the perils of the ocean, he has stepped on board the ship organising the race, assuming the role of CEO for seven years.
He first competed in the VOR in 1993/94 on board the Swedish boat Intrum Justitia which finished second and was skipper of Innovation Kværner in 1997/98 and in 2001/02 with Djuice Dragons. As CEO he has been instrumental behind the transformation of the race from an open class rule to a strict one-design Volvo 65 class boat race. He also has a business background in management, working in director and advisor positions with international companies.
Frostad believes the relationship between the race and Volvo is atypical to similar partnerships between sponsors and sporting events and described Volvo’s backing of the race as an “enormous strength”.
“Being involved with Volvo is very interesting because they’re very strategic and they think very long term,” said the 47-year-old.
“Typical sponsorship in sport is very short term, but Volvo has taken ownership of the event, so we can make long term plans; we can look at moving the event to new markets and Volvo is a very solid company.
Volvo is no stranger to big sporting events, putting its name to the Volvo World Match Play Championship the Volvo Golf Champions events. However, while the company announced in October 2014 that it would be withdrawing its backing for both of the above events, its support for the VOR shows no sign of waning, something both Forsbergh and Frostad are very excited about.
“It’s been a happy marriage so far and I certainly hope that the VOR will continue for many years,” said Forsbergh. It’s an established event, everyone knows about it.”
Frostad added: “Many sports today are struggling with very sketchy ownership structures that can change very quickly, particularly football. So for this event, it’s an enormous strength to have Volvo behind it. They let us get on with it.”
Apart from backing away from golf in December Volvo also announced it would be reducing its presence at various world motor shows in order to identify better ways to market its products.
These might all seem like drastic moves, but Forsbergh says it’s all aimed at maintaining the strength of the Volvo brand.
“The image we want to build is that we are professional in whatever we do. Whether it’s building trucks or organising events, we don’t want to put our name to it unless we’re going to make a success of it.
“Either you do something at the absolute top level or you don’t do it at all. As a premium brand you have to make sure you do everything with quality. If something’s worth doing it’s worth doing right.”
