Volvo has revealed that it will no longer meet its goal of producing only fully electric vehicles by 2030, and now anticipates that it will still be selling some hybrid cars by that time.
The automaker cited shifting market conditions as the reason for abandoning the target it set just three years ago.
This decision comes as the global automotive industry grapples with decreasing demand for electric vehicles (EVs) in certain major markets and uncertainty related to tariffs on EVs manufactured in China.
Volvo, which has long been known for promoting its eco-friendly image, follows in the footsteps of other automakers like General Motors and Ford, both of which have also scaled back their EV goals.
The company now predicts that at least 90% of its production will consist of electric cars and plug-in hybrids by 2030.
Additionally, Volvo may still offer a small number of mild hybrids, which are traditional vehicles with limited electrical support.
Jim Rowan, Volvo's CEO, reaffirmed the company’s commitment to an electric future, stating, "We are resolute in our belief that our future is electric," but acknowledged that the journey toward electrification will not be straightforward and varies across markets.
Volvo also noted that the business environment for EVs has changed due to factors like the slow development of charging infrastructure and the removal of consumer incentives.
A drop in demand for EVs has been especially noticeable in Europe, partially due to the elimination of subsidies for purchases in countries such as Germany.
According to the European Automobile Manufacturers Association, EV registrations across the European Union fell by almost 11% in July.
Since Volvo is majority-owned by China’s Geely and relies on factories in China, it will also be impacted by tariffs on Chinese-made EVs imported to Europe and North America.
Recently, Canada joined the US and the EU in imposing a 100% tariff on electric vehicles made in China.
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