Volvo introduced its second all-electric model, the C40 Recharge, on Tuesday, the next step in a plan to go 100% electric by 2030.
The Swedish-based manufacturer has been migrating to battery power in recent years and, by 2025, plans to offer only battery-electric vehicles and plug-in hybrids. By the end of the decade it will abandon those PHEVs and only sell BEVs.
The shift away from internal combustions is only one of the changes Volvo outlined Tuesday. The company, which is owned by Chinese automaker Geely, also plans to migrate to an entirely online sales model. That is likely to vary in execution from country to country and, in the U.S., even from state to state due to restrictive franchise laws.
“There is no long-term future for cars with an internal combustion engine,” Volvo chief technology officer Henrik Green said in a statement. The transition to BEVs, he added will “meet the expectations of our customers and be a part of the solution when it comes to fighting climate change.”
Change is coming
Volvo already produces a variety of plug-in hybrids, including a version of its XC90 flagship. It uses a gas-electric powertrain known as the T8 twin-engine.
The automaker’s first all-electric model, the XC40 SUV, was launched for the 2021 model year and uses a pair of electric motors. With one on each axle, the set up produces a combined 402 horsepower and 486 pound-feet of torque. The new C40 Recharge takes advantage of the same basic drivetrain. The new model is based on the same platform as the SUV.
Volvo also spun off a new brand, Polestar planning to sell only pure battery-electric vehicles going forward.
Håkan Samuelsson, the global CEO of Volvo Cars, signaled a major shift was coming last December. “I would be surprised if we wouldn’t deliver only electric cars from 2030,” Samuelsson said during the Financial Times Future of the Car Summit.
It joins a growing list of manufacturers moving in that direction. General Motors CEO Mary Barra said at this year’s Consumer Electronics Show that the automaker “aspires” to go entirely BEV by 2035. Nissan indicated it will switch to only hybrids and BEVs around that time. And, though it has not set a formal target for eliminating gas and diesel engines, Volkswagen is rapidly moving in that direction. Its Bentley brand will switch to battery cars entirely by decade’s end.
Volvo’s gonna skateboard
For its part, Volvo will use the underlying, skateboard-style platform in the current XC40 Recharge for many of its future models. It also is developing an all-electric platform for smaller products in partnership with its parent, Geely.
Geely last month said it scuttled plans to fully merge the two companies. Instead, they will continue to partner on the development of future products and technologies and efforts like parts purchasing where they can reduce costs by leveraging economies of scale.
Volvo also plans to make major changes in its retail operations. The company introduced a subscription model several years ago that has proven one of the industry’s most successful. The program allows buyers to do most of the purchase process online. It will serve as a model going forward, Volvo aiming to migrate entirely to online buying.
Exactly what form that will take is unclear but could borrow some details from Tesla which operates only factory-owned stores that largely serve as display centers rather than traditional stores. The challenge, at least in the U.S., comes from franchise laws that vary widely from state to state. In most cases, factory-owned stores are banned and online retailing must be done in partnership with franchisees.