But Don’t Expect to Drive a Volvo EV Soon
Volvo Cars put a date on it. All of its vehicles beginning in 2019 will have some portion of electrification (such as a mild hybrid system), a move it said was “about the customer…we want to respond to our customers’ current and future needs.” Hakan Samuelsson, president and chief executive of Volvo Cars specified that its whole range of cars would include full electrics, plug-in hybrid and mild hybrid cars.
The chief distinction of Volvo’s announcement was two-fold. They committed to introduce electrification in all vehicles and, they put a date on it. The announcement almost overshadowed the product announcements that accompanied it—Volvo plans to introduce five fully electric cars between 2019 and 2021 (three Volvos and two from its performance Polestar sub-brand.
Internal combustion engines aren’t going away anytime soon, Samuelsson noted, since Volvo will also add a range of gasoline and diesel plug-in hybrids and mild hybrid 48-volt models. And the U.S. may not see all of these new models, even though it is one of Volvo’s most important markets (more on that later).
Join the Crowd
While Volvo used the announcement to dramatize its shift and also set some sales goals (one million electrified cars on the road by 2025), it is far from the only company shifting to more electric cars. Tesla, of course, builds only electric cars and they are direct competitors to Volvo models, but it is a small manufacturer. Toyota some time ago committed to producing hybrid versions of all of its models, though it has yet to fulfill that promise. GM and Ford lead the American market in plug-in models while European and Asian manufacturers are adding models at an accelerated rate.
In fact, Volvo in the U.S. has been a late-comer to the plug-in market and currently has only one model—it’s impressive XC90 SUV that is available as a plug-in hybrid. Volvo has already announced it was adding a second model, the XC60 PHEV, next year. It’s had similar models in Europe, including a diesel-electric hybrid, for several years.
The Chinese Connection
Volvo Cars is a and appears destined to become that company’s premium brand in China. With the Chinese government push for electrification, the Volvo decision makes even more sense. Having a fully electrified (or new energy as China classifies the technology) could give Geely a competitive advantage in its home country. Volvo’s current sales are roughly equal in the U.S. and China, but because of Chinese regulations it is likely many of the plug-in models may appear first and some may be exclusive to that market.
Going even partially electric is not without challenges. During the first six months of the year in the prime U.S. market Volvo sold only 807 plug-in cars out of its total sales of 34,105. The numbers are comparable to other automakers, but Volvo remains a niche vehicle in this country, where less than one percent of cars sold nationwide are pure electrics.
The Other News
Volvo’s announcement didn’t happen in a vacuum, of course. Within a week Tesla said it was moving up the start of production of its affordable EV, the Model 3, Nissan announced the next generation Leaf would debut in early September and General Motors said its all-electric, 200+-mile range Bolt would be available nationwide in August. Volvo will either ride the crest of a growing (though slow-growing) movement toward electrified vehicles or it may be brushed aside by some of these larger or more popular car makers ongoing juggernaut .Only time will tell.
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