Volvo adjusts its electrification strategy

Volvo, the Swedish car manufacturer owned by the Chinese Geely Group, has announced that it will abandon its ambition to sell only fully electric cars by 2030. Instead, it aims for 90-100% of its global sales to be either pure electric or plug-in hybrids at that time.

Volvo attributes the change in policy to a “slower than expected rollout of charging infrastructure, the withdrawal of government incentives in many markets, and additional uncertainties created by recent tariffs on electric vehicles.” The latter, of course, refers to the surtaxes on the popular Volvo EX30, which is currently only produced in China.

Slower progress

“By 2025, Volvo expects the percentage of electrified products to be between 50 and 60%. Well before the end of this decade, Volvo Cars will have a complete line-up of fully electric cars available. That will allow Volvo Cars to move to full electrification as and when the market conditions are suitable,” says the press release.

“We are resolute in our belief that our future is electric,” said Jim Rowan, chief executive of Volvo Cars. “An electric car provides a superior driving experience and increases possibilities for using advanced technologies that improve the overall customer experience.”

“However, it is clear that the transition to electrification will not be linear, and customers and markets are moving at different speeds of adoption. We are pragmatic and flexible while retaining an industry-leading position on electrification and sustainability,” he added.

Updated CO2 reduction path

“As a result of its adjusted ambitions on electrification, the company is also updating its ambitions on CO2 reduction, which remains leading for the automotive industry,” the company claims.

By 2030, Volvo aims to reduce CO2 emissions per car by 65-75% compared to a 2018 baseline, an adjustment of the previous 75% reduction ambition. For 2025, the company aims for a 30-35% reduction versus a 2018 baseline instead of the previous aim of a 40% reduction.

“Volvo Cars plans to make further progress, including by working with its suppliers to continue reducing CO2 emissions from materials across the company’s value chain. During the year’s first half, CO2 emissions per car were 25 percent lower than its 2018 benchmark.”

One single technology stack

Starting with the EX90, Volvo’s future electric cars will be based on the same fundamental core of systems, modules, software, and hardware, called the Volvo Cars Superset tech stack. “It’s a single tech and software base containing all modules and functionalities we will use in our future product line-up.”

Like a set of building blocks, the Superset tech stack can be configured in many different ways. Each new car will be a selection, or a subset, of building blocks from the tech stack, which Volvo will continuously improve and grow.

“The Volvo Cars Superset tech stack is a true game changer: it allows all of our engineering effort to be channeled into one single direction that powers all our products instead of working on specific car projects,” says Anders Bell, Chief Engineering & Technology Officer at Volvo Cars.

“Our engineers will work on one superset, constantly improving, growing, and expanding its capabilities and features. This allows for dramatically improved quality, increased speed-to-market, and continually better cars for our customers,” he adds.

New-generation user experience

In 2025, around 2.5 million Volvo customers worldwide will receive an upgrade on their Volvo cars built as early as 2020. Volvo plans to roll out this upgrade gradually during the year and believes this is one of the most comprehensive infotainment updates by any car maker. This roll-out aligns with its strategy to improve the cars over time with regular over-the-air (OTA) software updates.

“Our new-generation user experience will significantly improve customer experience and is an important step in our journey to deliver human-centric technology solutions to our customers,” says Erik Severinson, Chief Product and Strategy Officer at Volvo Cars.

His message to the company’s customers is: “We’ll continuously and seamlessly adapt the user experience to match the needs of our customers through new and enhanced features that are delivered through over-the-air updates to improve your car and your experience over time. ”

Sales up

Volvo Cars reported global sales of 52,944 cars in August, up 3% compared to last year. The sales increase was primarily driven by the strong performance of their fully electric cars in Europe, while the Chinese market was more challenging.

The company’s sales of electrified models, fully electric and plug-in hybrid models, grew 47% compared to the same period last year and accounted for 47% of all cars sold during August. The share of fully electric cars constituted 25% of all cars sold for the month.

The total sales for the period of January through August amounted to 498,464 cars globally, an increase of 11% compared to the same period in 2023.

“It is good to see that we were able to close out August with continued sales growth. We have a robust brand and continue to see solid consumer interest across our lineup,” said Björn Annwall, chief commercial officer and deputy CEO at Volvo Cars.

“The performance in Europe was particularly encouraging, as the sales of our EVs continue to grow at a rapid pace, with the EX30 leading the way.”