Swedish automotive manufacturer Volvo has announced a decision to phase out production of vehicles powered solely by petrol or diesel fuel, stating that beginning in 2019, all new models the company introduces will be either hybrids or electric vehicles. Current models will still be manufactured with classic combustion engines, but many will also be offered as hybrids.
The news comes as a bit of a shock to many industry watchers. Though most auto manufacturers currently offer hybrid and electric models, the market share belonging to those vehicles is still rather small. Volvo is betting on this to change as time marches on, according to the company’s official announcement.
“This is about the customer,” said Volvo CEO Håkan Samuelsson. “People increasingly demand electrified cars and we want to respond to our customers’ current and future needs. You can now pick and choose whichever electrified Volvo you wish.”
Volvo plans to release five fully electric models between 2019 and 2021, including three Volvo models and two high-performance vehicles included in the company’s Polestar division. Specific details have not yet been released for these models.
According to Fleet Carma, Volvo sold just 2015 units of its XC90 electric SUV in 2016, so the move is definitely a gamble, but the company seems confident in its decision.
“This announcement marks the end of the solely combustion engine-powered car,” Samuelsson said.
“Volvo Cars has stated that it plans to have sold a total of 1m electrified cars by 2025. When we said it we meant it. This is how we are going to do it.”
In addition to the five solely electric models, Volvo is introducing a wide range of petrol and diesel hybrid models across its line.
Volvo states that the move to all hybrid and electric vehicles is in line with the company’s commitment to minimizing its environmental impact. In addition to the elimination of all new car models powered solely by combustion engines from its line by 2019, Volvo is also setting its sights on achieving climate neutral manufacturing operations by 2025. That’s a big deal for the environment and a goal many environmental activists would like all companies to strive to achieve.
According to the New York Times, Volvo is based in Sweden but owned by Geely Automobile Holdings of China. Geely already mass produces electric vehicles for the Chinese market and will manufacture the electric batteries for the Volvo vehicles at first. The manufacture of the batteries will eventually be moved to Volvo’s European facilities. The fact that Volvo has a Chinese parent company likely figured heavily in the company’s decision. China’s air pollution problems have its government scrambling for a push toward cleaner vehicles.
In the United States, while the Trump administration has not been as friendly to policies that encourage electric vehicles as his predecessor, Barack Obama, and gas prices are down, consumers may be increasingly open to electric vehicles or hybrids as time marches ahead and more charging stations begin to appear on roads. The trend worldwide for governments, especially in Europe, to implement regulations on fuel consumption and force automakers to adhere to strict environmental standards has automakers focused on investing in hybrid and electric technologies.
Volvo’s initiative to move toward hybrid and electric vehicles is admirable, but time will tell if consumer interest in such vehicles increases and the move pays off.
[Featured Image by Rachel Murray/Getty Images]