Despite recent warnings from other automakers, Volvo expects EV momentum to ramp up with three new electric models launching.
Volvo Cars released its third-quarter earnings Thursday, showing vehicle sales, revenue, and profit growth.
Volvo’s retail sales have increased for 13 straight quarters despite many key auto markets slowing down. The growth comes amid Volvo’s rapid transition to an all-electric future.
After Volvo was one of the first legacy automakers to commit to an all-EV future by 2030, the results are showing.
The automaker’s pure EV sales share reached 13% in Q3, up 111% compared to last year. Volvo says, “This underlines how Volvo cars is well on its way to becoming one of the fastest transformers in the industry.”
Volvo expects the competitively priced EX30 electric SUV launch to strengthen its position further. The EX30 will be Volvo’s most affordable EV, starting at around $35,000.
Volvo expects EV momentum to pick up with new models
The automaker significantly improved EV margins in the quarter, reaching 9%, up from 3% last quarter.
However, CEO Jim Rowan believes the company can do even better in the fourth quarter. Rowan said he expects EV margins to increase in Q4 due to lower raw material prices.
The company also expects that once the EX30 (see our review) begins shipping, it will “further boost Volvo Cars’ profitable growth in fully electric cars.”
Volvo said last quarter it expects the EX30 to boost the company’s gross margins into the 15-20% range.
Deliveries of the EX30 are starting soon. Meanwhile, Volvo will reveal its first electric minivan, the EM90, on November 12. On top of the flagship EX90 unveiled last year, Volvo has three new EVs in major segments.
Volvo said its order book remains stable while retail deliveries are on track for solid double-digit growth this year.
Top comment by Dan B
On this site (a little) and on some others, I've been reading all this doom and gloom about EV sales tanking. How GM this and that. How Honda bailed on GM (I knew they would use GM for what they wanted and then bail). Etc, etc. So I'm glad to read this article about how Volvo is doing and I see this first hand at our dealership.
What I've said on another site is that the media needs to stop acting like the slight downturn in EV sales is the end of the world! People need to stop reacting like EV's were just a short lived fad that has come to it's end. NEWSFLASH: The entire auto industry (including ICE and EV) has slowed. You can now drive on nearly any dealer's lot and find a slug of ICE trucks. Even the very beloved and great selling Chevy Trax is starting to build inventory. This doesn't mean that everything is going down the tank, but that it's a slowdown just like we've seen many times over the years.
I've been in the auto business now for 26 years and I've seen this happen way before EV's were much of a thought. When this happened in the past, the media and buyers didn't scream that we need to bring back the horse and buggy! This is all part of a natural cycle and we will see things turn again. But for now, we have really high interest rates on auto loans and buyers have been paying really high prices for about 2 years now. This all leads to the average auto loan payment being more than $1,000 per month!! Let that sink in.
Although Volvo’s EV sales share is down from earlier this year, the company expects new launches to turn that around next year quickly. The company aims to reach 50% electric vehicle sales share by 2025 as it works to become an all-electric automaker by 2030.
Electrek’s Take
Volvo’s comments drastically differ from other automakers, such as Ford and GM, which are pushing back EV targets to focus on profits now.
The company is prioritizing the transition to EVs now despite the uncertainty over the next few quarters. Despite the near-term outlook, electric vehicle adoption will continue building momentum over the next several years.
Volvo’s commitment now is paving the way for a profitable future while others continue to delay.
FTC: We use income earning auto affiliate links. More.
Comments