Volvo Backtracks On Fully Electric Future, Allows Room For Hybrids

Volvo Cars has announced a strategic adjustment to its electrification ambitions, reflecting evolving market conditions and shifting customer demands. While the automaker remains steadfast in its long-term goal of becoming a fully electric car company and achieving net zero greenhouse gas emissions by 2040, it has revised its previous target of exclusively offering fully electric vehicles (EVs) by 2030.

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Volvo Cars now aims for 90 to 100 per cent of its global sales by 2030 to consist of electrified vehicles, encompassing both fully electric and plug-in hybrid models. This shift acknowledges the continued relevance of plug-in hybrids as a transitional technology for consumers who may not yet be ready or able to switch entirely to EVs. The remaining 0 to 10 per cent of sales will allow for the inclusion of mild hybrid models if market conditions require.

The company’s previous strategy, which envisioned a fully electric lineup by 2030, has been adapted to maintain flexibility in response to the slower-than-anticipated development of charging infrastructure, the reduction of government incentives in certain regions, and the uncertainties introduced by recent tariffs on EVs in various markets.

Despite the adjustment, Volvo Cars continues to advance towards full electrification. The automaker has already introduced five fully electric models: the EX40, the EC40, the EX30, the EM90, and the EX90. The EX30 has been particularly successful, currently ranking as the third best-selling EV in Europe.

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During the second quarter of 2024, fully electric vehicles accounted for 26 per cent of Volvo’s sales, the highest among its premium competitors. Including plug-in hybrids, the company’s electrified vehicle sales represented 48 per cent of total sales. Volvo expects this figure to rise to between 50 and 60 per cent by 2025.

In light of the revised strategy, Volvo Cars will continue to develop its plug-in and mild hybrid models, which the company sees as a crucial bridge to a fully electric future. The automaker reported that approximately half of the kilometres driven by its latest plug-in hybrid models are powered by electricity.

The XC60 plug-in hybrid has emerged as the best-selling model in its category in Europe this year, reflecting strong consumer interest in vehicles that offer the flexibility of both electric and internal combustion power.