Sweden-based automaker Volvo announced Wednesday that any new or redesigned vehicle it introduces after 2019 will be electric or hybrid, moving the company away from producing vehicles with conventional internal combustion engines.
Electric cars are fully powered by an electric motor and a battery, while hybrids run on gasoline but get a boost in fuel economy from a battery.
“This is about the customer,” Volvo global CEO Hakan Samuelsson said in a statement. “People increasingly demand electrified cars and we want to respond to our customers’ current and future needs. You can now pick and choose whichever electrified Volvo you wish.”
USA Today reported that “Although the announcement marks what Volvo called the ‘historic end’ of gasoline vehicles, it will take years after 2019 for them to completely disappear off dealership lots. That’s because automakers typically sell new models for several years, with small improvements in the interim years, before completely redesigning them.”
Analysts contend that it could take until 2025 for all new Volvo vehicles sold at dealerships to be electrics or hybrids.
The decision makes Volvo, which is owned by Chinese automaker Geely, the first major automaker to plan a move to build only electric and hybrid cars. Silicon Valley automaker Tesla, categorized as a niche automaker by volume, sells only electric vehicles.
Volvo announced that their transition would begin with three new fully electric cars to be introduced from 2019 through 2021.
The automaker is seeking to sell 1 million electric or hybrid cars by 2025 and to reduce its carbon footprint.
“We expect that the decision is also largely driven by CO2 regulations,” Evercore ISI analyst Arndt Ellinghorst said in a note to investors, referring to carbon emissions standards.
According to USA Today, “Like other automakers, Volvo is under pressure to meet fuel economy targets, particularly in Europe, where diesel vehicles are falling out of favor.”
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