Sweden’s Volvo Cars abandons plan to sell only electric vehicles by 2030

Volvo AB EX30 car. (Qilai Shen / Bloomberg via Getty Images) — The Volvo EX30 electric sport utility vehicle is shown at the Beijing Motor Show, April 25.

Swedish carmaker Volvo Cars on Wednesday abandoned its short-term goal of selling only electric vehicles, citing the need for “pragmatism and flexibility” in the face of changing market conditions and falling demand.

Volvo Cars, owned by China’s Geely Holding, was one of the first traditional carmakers to pledge a full transition to electric vehicles. The company has said its long-term goal remains to become a fully electric carmaker.

However, the company has announced that by 2030 it aims to have 90% to 100% of its car sales be fully electric or plug-in hybrid models, while a limited number of mild hybrid models will be allowed up to 10%.

This target replaces a commitment from 2021 to have the entire Volvo Cars range fully electric by the end of the decade.

The move means Volvo Cars is following in the footsteps of other players in the industry in scaling back its electric vehicle ambitions. German carmakers Mercedes-Benz Group and Volkswagen have previously announced changes to their electric vehicle strategies.

“The electric car provides a better driving experience and increases the potential for advanced technologies that improve the overall customer experience,” Jim Rowan, CEO of Volvo Cars, said in a written statement on Wednesday.

“However, it is clear that the transition to electrification will not be linear, with customers and markets moving at different rates of adoption,” he added.

“We are pragmatic and flexible, while maintaining our industry leadership in electrification and sustainability.”

Volvo Cars shares fell more than 4% on Wednesday.

Volvo Cars said the share of all-electric cars in its lineup was 26% in the second quarter of 2024, noting that this was the highest among its premium competitors. The company said its share of electric vehicles, which refers to electric vehicles and plug-in hybrids, was 48%.

Highlighting the challenges facing its electrification ambitions, Volvo Cars said the rollout of charging infrastructure had been slower than expected, government incentives had been withdrawn in some markets, and there was additional uncertainty surrounding recent tariffs on electric vehicles in various markets.

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Volvo Cars said the changes showed there was still a need for “stronger and more stable government policies” to support the move away from fossil fuels.