Volvo Cars accelerates its electrification
According to Volvo Cars Corporation’s press release, Volvo Cars is going to sell only electric vehicles by 2030. The company will phase out all car models with internal combustion engines including hybrids. The carmaker is also planning to invest in online sales and to simplify its products. Of course, it is a tough challenge. However, the Swedish company tries to respond to growing demand for electric vehicles including in China. This is because China is the biggest market across the globe.
Who is Volvo Cars?
Volvo Cars Corporation is a Swedish multinational automotive manufacturer and it was founded in 1927. Its head office is located in Gothenburg, Sweden. It manufactures, researches, designs and operations in Europe, Asia and the Americas.
According to Volvo Cars Corporation’s homepage, modern seatbelts, side impact protection systems and pedestrian detection systems are specific features of its vehicles.. Volvo Cars is one of the most well-known and respected premium car brands. It prepares for a new future that will be all electric, autonomous and connected. Volvo Cars sold more than 705K vehicles in 2019, and has more than 40K employees in the average. It earned 14.3 bnSEK in 2019 as well.
Volvo Car Group (Volvo Cars) is owned by Zhejiang Geely Holding (Geely Holding) of China. Its group structure comprises Volvo Cars, software company Zenseact, and its related direct consumer businesses.
When it comes to sustainability, Volvo Cars aims to reduce CO2 emissions per car by 40 percent by 2025. This is a first tangible step towards long-term goal to realize carbon neutrality by 2040. The company thinks that electrification alone is not enough. In fact, the company will also tackle carbon emissions in manufacturing network, wider operations, and supply chain. Volvo Cars will achieve these ambitious goals by recycling and reusing of materials.
More premium cars become fully electric
From the end of 2020 to beginning of 2021, there are lot of news about electric vehicles. Smartphone makers such as Apple, Xiaomi and Huawei, might enter the market. Chinese companies took new initiatives through their partnership. The collaboration between BYD and Didi Chuxing, or the partnership between Baidu and Geely are examples.
In order to respond new policies to ban the sales of internal combustion engine vehicles, large automotive makers such as General Motor, Volkswagen and Toyota, also announced their plan to accelerate their electrification. When it comes to the premium car models, Volvo Cars has made a decision to go fully electric by 2030.
However, this decision does not seem new because Bentley, a British luxury automotive maker, has already unveiled its fully electric plan. Daimler is also planning to pursue electrification through its restructuring. Therefore, the trend that premium car brands seek electrification seems to make sense.
Why premium car brands go electric?
There are two reasons why premium car brands go electric.
First, lithium-ion batteries accounts for large part of electric vehicles’ cost and its cost is still high. Therefore, the price of EVs becomes expensive, too. The rich will purchase premium car brands in many cases and they are afford to buy them indeed. Thus, they do not really care about the price of EVs. On the other hand, they pay attention to user experience, quality, status and brand itself.
Second, one of electric vehicles’ characteristics is their customization. This is because electric vehicles do not need engines and have more space for customization. Therefore, it will work for the rich since they want to own their special automotive.
In the end, we can expect that more premium car brands go fully electric.