Volvo eyes 10% EV share despite big July setback

Europe

Volvo Cars took a step backward last month on its quest to reach a key sales milestone for its full-electric vehicles.

EVs accounted for 3.5 percent, just 1,583 units, of automaker’s total global volume in July. That was a 26 percent decline on its EV sales in July 2021.

The automaker’s overall volume was down 22 percent to 44,664 in July.

Despite the setbacks, Volvo remains confident EVs will account for at least 10 percent of it’s full-year volume, which it predicts will be flat.

Volvo, which wants to be an electric-only brand by 2030, is bullish because it “continues to see a marked improvement in the stabilization of its supply chain, with July confirming the positive trend in production seen in June,” the company said in a statement.

The dip in EV sales is expected to continue temporarily before making a positive turn.

“We will see a slight decrease [in EV sales] in the third quarter, but we will have quite a steep increase in the fourth quarter,” Volvo’s acting Chief Financial Officer, Johan Ekdahl, told Automotive News Europe last month.

Ekdahl said the continued decline is because of the time it takes for increases in production to be reflected in retail sales.

“Also, the increased installed capacity for EVs we have added will help us increase the volumes gradually during the second half,” he said.

Volvo has increased the annual production capacity for full-electric cars at its plants to 155,000, which is more than 12,900 EVs a month.

Volvo sold 698,693 vehicles last year with EVs accounting for 25,727, or 3.7 percent.

Through July, Volvo is 101,675 units behind its sales level from the same period last year.

To erase that deficit and match it volume from the last five months of 2021 Volvo will need to average about 72,400 sales a month.

To get to its EV goal, which would be more than 69,000 units, it will need to sell on average more than 9,200 full-electric models a month for the rest of the year.

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