Volvo, MFTA Cook Up a Deal

Volvo Trucks North America dealers in Canada have been offered the sales and service franchise for Mitsubishi Fuso Truck of America’s line of class-3 through class-7 cabover trucks, six months after MFTA announced its intent to compete for a share of the midrange market in Canada.

The agreement would allow Volvo dealers to sell and service MFTA’s 10-model line of low cabovers rated from 12,000 pounds to 32,900 pounds GVW. MFTA established a Canadian division last October, led by Brian Schantz, former director of Canadian dealer operations for Volvo GM Heavy Truck Corp.

The company had set annual sales targets of 1800 to 2000 trucks in Canada. Volvo Trucks currently sells a full range of class-8 models, rated 33,001 pounds GVW and higher. Volvo does not sell a medium-duty vehicle in North America.

“This alliance is a good fit strategically for Volvo Trucks and Mitsubishi Fuso,” says Marc Gustafson, president and CEO of Volvo Trucks. “The products are complementary, which will allow Volvo dealers to offer an expanded range of trucks. Customers will benefit through an extended and strengthened sales and service network.”

The sales and distribution deal builds on a longstanding and far-ranging global relationship between the two truck makers. Last year, Volvo agreed to buy 19.5% of the truck and bus business of Mitsubishi Motors, MFTA’s corporate parent, and Mitsubushi agreed to acquire 5% of Volvo. Volvo and Mitsubishi Motors also formalized a strategic alliance involving product development, sales, and distribution in the truck and bus segments.

Mitsubishi already sells light trucks through Volvo’s dealer network in Europe, and currently cooperates on sales and service in Asia, South America, Australia, and New Zealand.

Volvo and MFTA’s distribution deal in Canada is seen as a precursor to a similar franchise arrangement in the United States. MFTA has a network of 155 U.S. dealers; Volvo has more than 200.