In 2013, the Volvo Group purchased goods and services worth SEK 192 billion. Since 1996, the Group has consistently increased supplier requirements on environmental issues, business ethics, human rights and social issues.
The Volvo Group’s suppliers can be divided into two groups:
- suppliers of automotive products
- suppliers of indirect products and services.
Automotive products are materials and components used in the production of the Group’s trucks, buses, construction equipment and engines. Indirect products and services include any products or services that are not used in automotive products. This encompasses everything from cleaning services to office furniture, travel, education or training, communication services and corporate merchandise.
In 2013, more than 36,000 suppliers delivered products and services to the Volvo Group, of which approximately 6,900 supplied automotive products.
As a general rule, we stipulate that sales to the Volvo Group should account for less than 30 percent of a supplier’s turnover. This approach decreases a supplier’s exposure when delivering to a cyclical industry such as ours.
The Volvo Group has long-term partnerships with suppliers and shares common tools. Generally we source close to our production sites to ensure efficient flow of supplies. This means that most suppliers are located in Europe and North America. At the same time, the Group’s expansion in Asia has led to an increased number of new suppliers located in Asia.