The car company Volvo has abandoned its goal of producing only fully electric cars from 2030. The automaker blamed changing market conditions for its decision to drop the target it announced just three years ago.
This comes as the industry faces slowing demand in some major electric vehicle (EV) markets and uncertainty over the imposition of trade tariffs on Chinese-made EVs.
Volvo, which traditionally prides itself on its environmental credentials, joins other major automakers General Motors and Ford in pulling back on EV ambitions.
Volvo now expects at least 90% of its production to be electric cars and plug-in hybrids by 2030.
The Swedish company may also sell a small number of so-called mild hybrids, which are more conventional vehicles with limited electric assistance.
“We are firm in our belief that our future is electric,” said Jim Rovan, CEO of Volvo. “However, it is clear that the transition to electrification will not be linear, with customers and markets moving at different speeds.”
The company also said the business climate for electric vehicles has changed due to factors such as the slow rollout of charging infrastructure and withdrawal of consumer incentives.
Independent equity analyst Anna Macdonald said consumers remain concerned about the shift to electric vehicles.
“Some of the subsidies that governments gave to encourage the purchase of electric cars have ended and there is a continued lack of demand because consumers are worried about charging,” she told the BBC.
“It is still the case that electric cars remain more expensive.
“While the EU and the US are imposing tariffs on imported Chinese cars to prevent them from flooding the market, this only means that the vehicles have to be manufactured outside of China, which is itself more expensive.
“Car manufacturers don’t want to start making losses on these vehicles,” Ms McDonald added.
Registrations of electric vehicles across the European Union fell by nearly 11 percent in July, according to the European Association of Automobile Manufacturers.
Volvo is majority-owned by Chinese car giant Geely and because it uses factories in China, it will also be hit by tariffs on imports of Chinese-made electric vehicles in Europe and North America.
Last week, Canada announced it was imposing a 100% tariff on imports of electric vehicles made in China, following similar announcements by the US and the EU.
Western countries have accused China of subsidizing its electric vehicle industry, giving its automakers an unfair advantage.
China rejected those allegations and criticized the tariffs as “discriminatory”.
Ford has also scaled back its EV ambitions. Just last month, the American auto giant announced it was scrapping plans for a large, three-row, all-electric SUV and delaying the launch of its next electric pickup truck.
Its rival General Motors has also lowered its electric vehicle production targets over the past year.
E2 portal (BBC)
Source: www.e2.rs
