Pehr Gyllenhammar

Character is Destiny


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overshooting a turn I ran straight into a lamppost. The impact was so severe that the engine of the car came through the dashboard. The car was obviously totaled, which in that moment was only distressing to me because I was now late for the meeting and still a short distance from the Volvo headquarters. So I walked the rest of the way to the office building and up to the conference room where the meeting was already underway. I opened the door and strode in, and every person in the room turned to stare at me. At that point, I realized that I had blood all over my shirt. I’m sure I made for a fascinating sight, but no one asked me any questions at all. And I offered no explanation. It was very bizarre. I simply launched into the beginning of my presentation, and about an hour into it, I was interrupted by a knock on the door. Someone opened it, and there was a policeman, scrutinizing all of the executives that were seated around the table.

      “I’m looking for a Mr. Gyllenhammar,” the policeman said. “Is he here?”

      I could hardly say that no, he was not.

      “I am Mr. Gyllenhammar,” I said, from where I was still standing at the front of the conference room, bloody shirt and all. Ultimately, I was prosecuted for leaving the scene of an accident and had to make a court appearance. They asked me to describe the accident and explain why I left, which I did, with the only qualifying detail being my determination to get to my meeting and give my presentation. I was given a rather large fine to pay, and that was that. But what is most memorable to me still is that when I walked into the courtroom, there was a class of local schoolchildren there, sitting in on some proceedings in order to learn how the justice system worked in action. When I walked through the door, one of the children said, “There he is, there is Mr. Gyllenhammar.” And all of the little faces turned to stare at me. It was certainly an unforgettable experience for me, and not quite the first impression I wished to make with my Volvo colleagues or the youth of Gothenburg. Whether the children found it equally memorable is debatable.

      I vividly remember going down to the Volvo plant for the first time to visit and talk to the workers. It was only very rarely that the workers saw a CEO or top management walking the factory floor, and in those occurrences the executive would be more ingratiating than businesslike, dressed down in something deemed sufficiently casual for the workers’ sensibilities. I arrived on the factory floor still in my suit and tie and addressed them directly, with questions to which I genuinely wanted to know the answers—I was asking them to share knowledge and expertise that I knew only they had. My approach seemed to resonate with the workers, because they welcomed me with surprise and genuine warmth. Over the years, my visits to the factory floor were among the parts of my job I most looked forward to.

      By some accounts the genesis of Sweden’s automotive future was conceived in 1924 over a large dish of red crayfish at a popular Stockholm restaurant. It was there that Assar Gabrielsson—sales manager for the SFK industrial company—and SFK engineer Gustaf Larson—happened to run into one another. They jointly tucked into the crustaceans—which had been boiled in beer and seasoned with fresh dill—eating them cold from the shell. During the course of that meal the conversation turned to cars, namely the 15,000 vehicles being imported into Sweden annually. Was it not possible to produce cars locally, they wondered? As Gabrielsson would later write, “Swedish steel was good, but Swedish roads were bad.” The two began discussing the possibility of designing and building a quintessentially Swedish automobile, designed to safely withstand the rigors of northern European winters and Swedish roads, and constructed to the highest standards of quality and safety. Three years later, in April of 1927, the first Volvo car rolled out of the Lundby factory gates—the ÖV 4, nicknamed Jakob. The ÖV 4 (short for Öppen Vagn 4 cylindrar) was an open four-seater with a four-cylinder engine, with leather upholstery, and a deep blue chassis with black fenders atop twenty-inch wheels with wooden spokes.

      On the fiftieth anniversary of Jakob’s arrival on the scene, we published a Volvo Jubilee historical booklet that celebrated the history of what Volvo had accomplished in the last half century. It opened with a brief essay on the ÖV 4 that began, “It’s 1927, a year of superlatives. Lindbergh flies the Atlantic…movies talk… Babe Ruth hits 60 home runs. A year of automobiles, too. Ford is phasing out the Model T… names like Packard, Willys-Overland, Reo, Pierce-Arrow, Stutz, Auburn are all strong in the American market. There’s a worldwide fascination with automobiles. In Sweden, a new name enters the field…Volvo. A 4-cylinder open touring car called Jakob, begins what is to become the outstanding example of constant progress through evolution in the automotive industry.”

      The war years were difficult for Volvo, but the company rebounded, and by the 1960s was boasting healthy car sales and exports, and producing trucks and buses, as well as jet turbines for the Swedish Air Force. When I arrived, I found the company to be in very good shape. It was 1970, a year before the recession, and four years before the oil crisis that would impact the auto industry all over the world. The company’s financials were more than sound, and in all respects Volvo had prospered in over two decades under the guidance of my father-in-law, Gunnar Engellau, who came to that position having been the engineer heading Volvo’s aviation subsidiary.

      Gustaf Larson wrote “Cars are driven by people. The guiding principle behind everything we make, therefore, is and must remain safety.” When my father-in-law succeeded Assar Gabrielsson as Volvo’s CEO, he elevated the concept of safety as a brand asset—something that differentiated it from every other automobile maker. I have great respect for my predecessors, particularly my father-in-law, who was a great supporter of mine. I made many mistakes, but he never once told me he regretted picking me to succeed him, and I’m always touched when I think about that. But in order to keep Volvo evolving, I knew there must always be change, even when the current status quo was profitable. I believed we could take the brand asset of safety farther—by, among other things, extending the reflection of our consumer’s values to our factory workers, by placing an emphasis on worker safety and well-being as well as on environmental issues. And I had some very specific ideas about the product development of cars, as well.

      These ideas became the genesis of the Volvo 240 series, successor of the 140 and of the wildly popular Amazon model. The Volvo 240 would not be substantially changed in shape, but in technology it was totally different. Beginning from the base of a concept car known as VESC, the Volvo Experimental Safety Car, the 240 was distinguished from its predecessor with the addition of the newest B21 engine, specially designed struts and rack and pinion steering, large front and rear crumple zones, and oversize aluminum bumpers. The solidity and resilience of its chassis was extraordinary, and the 240 became the most robust passenger car on the market. Of course, safety remained the single top priority in every design decision, and it was evident that the 240 was the pinnacle of what could be achieved when the US used it to establish required safety standards for all American-made cars. I was able to say with full confidence at a ceremony celebrating the 240 that we had “…the world’s safest car, one of the most worthwhile cars to buy, and a car that is already living legend and will be even more of one in the years to come.”

      Another avenue of change that I pursued was the relationship of our industry to the environment. In the early 1970s, the awareness of environmentalism was only beginning to rise, and in 1972, the very first global environmental convocation—the United Nations Environmental Conference—was organized to take place in Stockholm. I gave a keynote speech at that conference, and Volvo’s website today still bears a line from it: “We are part of the problem—but we are also a part of the solution.” It was a very deliberate choice of words on my part. These were very early days for environmentalism—it was just a few years after the formation of the Club of Rome—and it was not a popular subject in industry. I felt it was very important to avoid any ambivalent statements that could be construed as a denial that Volvo was a contributor to pollution and processes that were unfriendly to the environment. I wasn’t going to claim that we were different, that we were the good ones. Instead, I admitted that we were bad too, and that needed to change. Why should it be so unheard of to admit the undeniable and take accountability for it?

      Another new direction for Volvo was our participation in the development and production of space flight technology. In 1975, the European Space Agency was formed, a cooperative venture of twenty-two member-states. Volvo produced a component of the first Ariane rocket, a series of launchable spacecraft that were a collaborative