Volvo has announced that they will only sell Electric Vehicles (EVs) in Australia by 2026. The Sweden vehicle brand seems to be capitalising on the rapid growth of electric vehicles in the country.
In fact, the new announcement shows Volvo’s commitment four years ahead of the global announcement by Volvo Cars last year that it aims to only sell EVs by 2030.
Last month, the Electric Vehicle Council’s latest report showed that EV demand increased by 65 per cent in 2022.
Making a full electric switch
Stephen Connor, Volvo Australia’s managing director, said, “We see an opportunity in our marketplace today—I think our consumers are ready for this.
The brand is also grateful for Tesla as it is the EV brand that did all the heavy lifting for many car brands to follow and make that step towards electric cars.
With that, the brand will no longer bring any new vehicles powered by petrol or diesel and will introduce a new EV every year. This also marks the XC60 to be the last Volvo sold in the country that features an Internal Combustion Engine (ICE).
By 2026, the Swedish brand aims to sell 20,000 units, be fully electric, and have a two per cent market share. In addition to this, Volvo aims to ensure every retailer has a fast charger that will be free for their customers.
One of the reasons Volvo is confident to make the switch to fully electric is because of the high sales that they are getting from their EVs, particularly the XC40 Recharge and the C40. They also have 1,600 backorders for the XC40 Recharge.
Staying ahead of the competition
Connor believes that the market will be jam-packed by 2030, considering the rapid changes that are happening in the EV industry. Moreover, he also sees that those who are still working on diesel and ICE cars may find themselves struggling in the near future.
Volvo Trucks is also on the move and aims to be the first globally to start production of heavy-duty electric trucks. The goal is to reach 50 per cent of sales by 2030 and 70 per cent in Europe.
Indeed, Volvo is all for sustainability, and even has an overall zero emissions strategy with a full commitment to becoming a fully climate-neutral company by 2040. The Torslanda car plant in Sweden was the first to become climate neutral. In fact, their manufacturing plants are already running on 80 per cent hydroelectric energy.
It’s not that simple
The vision is impressive, yet there are certain hurdles that Volvo will need to overcome first to reach its goals. For one, there is a strong need for the automaker to secure a strong supply, which can be challenging due to the high global demand for EVs.
Another one is that they need to convince their dealers in Australia to make the switch, which can be difficult for some, specifically those who are selling combustion vehicles and profiting a lot from them.
However, Volvo seems to already have a strategy in place for the operational implementation.
“We’re not saying to them that this stops your business model, you have to close your doors. What we’re saying is it’s a new way of working, let’s be bold. There’s still 20 million cars on the road so they’ll still to service cars—and that will continue for the next 30 years, probably even longer, so there’s still that profit opportunity,” Connor said.
Volvo is also prepared to lose some customers whilst rolling out their plans because prices may rise a bit, and the move to EVs is quite a change of mindset and way of life for many.
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