Volvo Scraps Plan to Sell Only Fully Electric Cars by 2030

The Volvo logo is seen in truck for sale in Linden, N.J., on May 23, 2022. Andrew Kelly/Reuters

Auto giant Volvo Cars announced on Sept. 4 that it has abandoned plans to sell only fully electric cars (EVs) by 2030, saying it now expects to sell both plug-in vehicles as well as some hybrid engine cars by that date.

The Chinese-owned Swedish vehicle maker revealed it has scrapped its previous target in a press release, citing “changing market conditions and customer demands.”

Going forward, the company said it aims for 90 to 100 percent of its global sales volume by 2030 to consist of “electrified cars,” meaning that there will be a mix of both fully electric and plug-in hybrid models or, “in essence, all cars with a cord.”

“The remaining 0-10 percent will allow for a limited number of mild hybrid models to be sold if needed,” the vehicle maker said.

The announcement marks a backtrack on Volvo Cars’s 2021 pledge to become a fully electric car company by 2030.

At the time, the automaker said it planned to phase out any car in its global portfolio with an internal combustion engine, including hybrids, as part of its “ambitious climate plan, which seeks to consistently reduce the life cycle carbon footprint per car through concrete action.”

In its latest press release, the auto giant, which is owned by China’s Geely Holding, said there has also been a “slower than expected” rollout of charging infrastructure, as well as a withdrawal of government EV incentives in some markets.

Additional uncertainties have been created by recent tariffs on EVs in various markets, the company said.

“With this in mind, Volvo Cars continues to see the need for stronger and more stable government policies to support the transition to electrification,” it added.

Volvo’s announcement follows in the footsteps of other vehicle giants, including General Motors, which in June cut its EV production range for 2024 by 50,000 vehicles citing softening demand.

Auto Industry Battling Rising Costs, Waning Demand

In August, rival Ford also pulled back its EV strategy, canceling plans for a fully electric three-row SUV and delaying production of its next-generation electric pickup truck amid soaring inflation and changing consumer demands.

It comes as the U.S. auto industry in general grapples with increased production costs, tougher competition, and a slump in EV demand.

Volvo Cars noted in its latest press release that it expects roughly 50-60 percent of its products to be electric by 2025.

Before the end of the decade, the car giant expects to have a “complete line-up of fully electric cars available,” allowing it to make the move to full electrification “as and when the market conditions are suitable,” it said.

Despite abandoning the all-electric plans, Volvo said that with five EVs already on the market—the EX40, the EC40, the EX30, the EM90, and the EX90—and another five models in development, full electrification remains a “key pillar” of its product strategy.

The company said its long-term aim remains to become a fully electric car company, and it also aims to reach net zero greenhouse gas emissions by 2040.

“We are resolute in our belief that our future is electric,” said Jim Rowan, chief executive of Volvo Cars.

While touting the “superior driving experience” of electric cars, Rowan acknowledged 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,” Rowan said.