July 6th, 2017
Volvo has announced that it will only produce fully electric or hybrid cars from 2019, making it the first mainstream car manufacturer to phase out cars solely powered by internal combustion engines.
This may well be a landmark moment and one of the clearest a signs yet that tradition petrol or diesel fueled cars may be a thing of the past sooner than many expected.
“This announcement marks the end of the solely combustion engine-powered car,” Volvo CEO Håkan Samuelsson announced yesterday in a live-streamed press conference.
The Sweden-based company, which is owned by the Chinese car manufacturer Geely Holding Group, plans to release five fully-electric vehicles (EVs) between 2019 and 2021, followed by a range of hybrid-powered cars equipped with petrol or diesel engines.
Volvo envision that they will have 2 million of their new electrified vehicles on the road by 2025.
Car manufacturers scrambling to comply with EU 7 legislation
Samuelsson said the move is a response to customer demands. However, it is probably no coincidence that the plan will coincide with the introduction of EU 7 legislation.
The EU 7 will introduce legally-binding carbon emission targets for new cars sold in the EU by 2020 and will limit new car CO2 emissions to 95 grams per kilometer. The average in 2016 across the EU was 118 grams per kilometer.
Many other car manufacturers, including BMW, Volkswagen, Jaguar and Land Rover, have laid out ambitious plans to ramp up production of electric cars in order to comply with this legislation.
The fact is that Volvo is quite some distance behind its competitors when it comes to both hybrid and EV technology and production.
Renault leads the pack when it comes to sales of EVs in Europe for 2017, followed by Nissan, Peugeot, Kia and the much vaunted Tesla.
EV sales continue to break records, but ending subsidies could spell danger
The global sales of electric vehicles hit a record of 750,000 in 2016 and 2017 is set to far far surpass that figure again, with projected sales of over 1,000,000 vehicles.
China is the largest manufacturer, accounting for 40% of electric cars sold, with the EU coming in second.
However, the fragile nature of the EV market and its reliance on substantial government tax subsidies was recently highlighted in Denmark.
EV sales there dropped 60 per cent in the first quarter of this year compared with the same period in 2016.
This consumer U-turn came as the Danish government planned to phase out EV tax subsidies between 2016 and 2020. Although the government did a U-turn of their own on this plan in April, consumer confusion still exists and it is affecting sales.
In Ireland EV owners benefit from a €5,000 grant from the Sustainable Energy Authority of Ireland, up to €5,000 vehicle registration tax relief and 800 free charge points dotted around the country.
It is clear that EV technology is coming down the road but it is still unclear at exactly what speed and what obstacles lie in the way.
