More than three years after declaring that it would sell only electric cars by 2030, Volvo has scaled back its EV ambitions. The company now aims to sell 90-100% electric vehicles (including fully electric and plug-in hybrids) by the end of the decade, with the remaining 0-10% being mild hybrids. Volvo said the revised target was due to “changing market conditions and customer demand.”
Volvo says it remains committed to electrification in the long term: Since setting its (now abandoned) 2030 target three years ago, the company has launched five all-electric models: the EX40, EC40, EX30, EM90 and EX90.
The company cited slower than expected deployment of EV charging infrastructure as one of the factors in its decision. Despite the passage of President Biden’s bipartisan infrastructure act in 2021, allocating $7.5 billion to support the installation of 500,000 EV charging stations, only seven stations had been built in four states as of March. Reasons for the slow deployment are said to include inexperience on the part of state transportation agencies in charge of implementation, as well as various government requirements (submitting plans, calling for bids, awarding funds).
The Biden administration said earlier this year that it still expects the number of charging stations in the U.S. to reach 500,000 by 2026.
Volvo also cited “additional uncertainty created by recent tariffs on EVs in various markets,” likely a reference to the hit the company has received because it manufactures some models in China. Earlier this year, the White House announced new taxes on Chinese-made EVs and batteries sourced from China. (Volvo’s parent company, Volvo Car AB, is majority-owned by China’s Geely Holdings.) Forbes reported in May that the price of a China-made EX30 was expected to start at $37,000 but would rise to more than $50,000 after the tariffs were introduced.
The company also adjusted its CO2 reduction expectations to align with the adjusted timeline. The company says it now aims to reduce emissions per vehicle by 65-75% (relative to 2018) by 2030; its previous goal was 75%. Additionally, the company also changed its previous goal of a 40% reduction per vehicle by 2025 (again, compared to 2018); its goal is now a 30-35% reduction.
“We believe the future is electric vehicles,” Volvo Cars CEO Jim Rowan wrote in a press release. “Electric vehicles provide a great driving experience and increase the availability of advanced technologies that improve the overall customer experience. But it’s clear that the transition to electrification will not be linear, and customers and markets are adopting at different speeds. We will respond pragmatically and flexibly while maintaining our industry-leading position on electrification and sustainability.”
