Volvo Car Group says it will add plug-in hybrid vehicles across its entire product range, develop a whole new line of electrified smaller cars, and build an all-electric car for sale by 2019.
"We believe that the time has come for electrified cars to cease being a niche technology and enter the mainstream," Volvo Car Group President and CEO Håkan Samuelsson said in a statement. "We are confident that by 2020, 10% of Volvo’s global sales will be electrified cars.”
Volvo's bigger bet on electrification kicks off with the launch of a twin-engine all-wheel plug-in hybrid version of the new XC90 SUV, which will have a pure electric range of about 26 miles. The company will then introduce a plug-in hybrid versions of its S90 premium sedan and 60 series vehicles.
Volvo will then add a new lineup of smaller 40 series cars. Volvo says it will produce an all-electric vehicle by 2019. The company didn't provide any details—price or specs—about its all-electric vehicle.
The announcement not only marks the Swedish car company's deepening investment in electric vehicles, it shows a growing willingness within the industry to move away from gasoline- and diesel-powered cars—or at the very least diversify its lineup to meet changing consumer demand.
Volvo, (volvy) which is owned by Zhejiang Geely Holding Group of China, says it learned a lot about electric vehicles just by studying how its customers have used its current lineup of plug-in cars. “Our research has shown that people are driving our twin-engine cars in electric mode around 50% of the time, meaning our plug-in hybrids already offer a real alternative to conventional powertrain systems,” Dr. Peter Mertens, Volvo's senior vice president for research and development, says in a release.
"We have come to a point where the cost versus benefit calculation for electrification is now almost positive," Mertens says. "Battery technology has improved, costs are going down, and public acceptance of electrification is no longer a question."
The move could help Volvo boost U.S. sales, which have been on a decline in the past few years as consumers opt to buy from its top competitors such as Audi, BMW, Lexus, and Mercedes-Benz. Volvo's U.S. sales have dropped 60% since peaking at 139,384 in 2oo4.
Navigant Research has forecast that annual plug-in electric vehicle sales will exceed 860,000 in 2024. About 123,049 plug-in electric vehicles were sold in the United States in 2014, a 26% jump from 2013 and a 134% jump from 2012, according to research from InsideEVs.com.
Earlier this month, Volvo's Samuelsson said that the company will accept full liability whenever one of its cars is in autonomous mode. Samuelsson, who made the comments during a seminar on self-driving cars, said Volvo is “one of the first car makers in the world to make such a promise.”