NAIROBI, Kenya- Volvo has hit the brakes on its ambitious target to go fully electric by 2030, signaling a shift in strategy amid fluctuating market conditions and growing uncertainty in the electric vehicle (EV) sector.
The Swedish automaker, known for its green image, announced that while it still sees an electric future, it now expects to sell some hybrid vehicles alongside its EVs by the end of the decade.
Just three years ago, Volvo boldly pledged to produce only fully electric cars by 2030, but recent shifts in demand and global trade tensions have forced the company to rethink its strategy.
In an unexpected turn, Volvo now plans for at least 90pc of its production to be a mix of electric cars and plug-in hybrids by 2030.
Volvo’s CEO, Jim Rowan, addressed the change, stating, “We are resolute in our belief that our future is electric.
However, it is clear that the transition to electrification will not be linear, and customers and markets are moving at different speeds.” In other words, while the dream of going fully electric remains, market realities are demanding a more flexible approach.
The EV market is currently experiencing turbulence, with slowing demand in key regions like Europe, where the end of government subsidies has dampened sales.
In Germany, for instance, the removal of incentives led to a significant drop in EV registrations, highlighting the impact of financial support on consumer behavior. According to the European Automobile Manufacturers Association, EV registrations across the European Union fell by nearly 11pc in July alone.
Volvo isn’t the only automaker feeling the pinch. General Motors and Ford have also scaled back their EV ambitions.
Ford recently scrapped plans for a large all-electric SUV and delayed the release of its next electric pick-up truck, while General Motors has reduced its EV production goals over the past year.
The industry-wide slowdown, paired with consumer hesitance and a patchy charging infrastructure rollout, has left manufacturers recalculating their next moves.
Beyond demand issues, trade tensions are adding to the challenge. Volvo, which is majority-owned by Chinese car giant Geely, has been caught in the crosshairs of a growing trade war.
The U.S., Canada, and the European Union have all slapped tariffs on electric vehicles made in China, including those from Volvo’s factories.
Last week, Canada announced a 100pc tariff on China-made EV imports, following similar moves by the U.S. and EU. Western nations accuse China of unfairly subsidizing its EV industry, while China calls the tariffs discriminatory.
Volvo’s pivot comes at a time when automakers are navigating a delicate balance between advancing their EV agendas and coping with geopolitical and economic headwinds.
