A Volvo dealership worker introduces the Volvo xc60 and other models via live streaming in Shanghai, China, March 18, 2024.
Cfoto | Future release | Getty Images
Volvo Cars cut its margin and revenue targets on Thursday after the corporate announced it now not goals to sell exclusively electric vehicles by 2030.
The Swedish carmaker, which is majority owned by the Chinese Geely Holding, announced that it’s now aiming for an EBIT margin (earnings before interest and taxes) of seven to eight percent for 2026. The previous goal was a decline of “over 8 percent”. The reason for that is the “increasing complexity, especially in connection with global trade and tariffs”.
The company added that it was now attempting to “continue to grow faster than the premium car market through 2026,” fairly than sticking to its previously announced sales goal of 500-600 billion Swedish kronor (48.6-600 billion kronor).
The ever-changing international trade disputes and tariffs have change into a serious problem for automakers as they have to navigate the geopolitics between the European Union, China and the US while in search of a competitive advantage in a market dominated by the shift to electric vehicles.
Volvo Cars shares rose 3.2 percent in early afternoon trading, after falling 10 percent this week.
The company is holding its Capital Markets Day in Gothenburg, Sweden, where it’ll discuss its product plans for the approaching years, with a concentrate on the shift to electric and plug-in hybrid models. Volvo Cars has five fully electric models in the marketplace and five more in development.
But on Wednesday the corporate said it now not goals to sell 100% electric vehicles – which it defines as “cars with a cable” – by 2030, as a substitute aiming for a spread of 90% to 100%, so mild hybrid models can still be sold. Mild hybrids have combustion engines that use partial electric assistance.
Volvo cited consumer demand, slower-than-expected expansion of charging infrastructure, the withdrawal of presidency incentives in some markets and uncertainty because of latest tariffs on electric vehicles in various markets as reasons for the change.
The company said it might proceed to sell fully electric vehicles in the long term “when market conditions are suitable.”
Numerous automakers are reporting problems related to the transition to electric vehicles, particularly because of low demand. Meanwhile, many consumers proceed to complain about inadequate charging infrastructure and lift concerns about range.
Volvo Cars also announced on Thursday that it Expansion of the partnership with US chip giants NVIDIA while developing features equivalent to advanced driver assistance and autonomous driving. It also said it might “single technology stack” because it goals to scale back the fee of producing electric vehicles.
Figures released by Volvo Cars on Thursday showed global sales rose 3% in August in comparison with the identical period last yr, driven by 32% growth in Europe, while sales in China slumped 23%. Fully electric and plug-in hybrids accounted for 25,028 of 52,944 vehicles sold in August 2024 – or 47%. The rest were mild hybrids and vehicles with combustion engines.
In July, the corporate reported a record quarterly operating profit of 8.2 billion Swedish kronor.
