The trend towards electrification is still rolling forward, but when it comes down to the details, it is not the same as some expected.
Last Wednesday, following Mercedes-Benz, Volkswagen, Ford, GM and others, Volvo also adjusted its electrification targets. Or "fine-tuning".
By 2030, 90-100% of its vehicles will be pure electric or plug-in hybrid. Instead of 100% of the EV as previously determined.
The other 0-10% of the products will be mild-hybrid.
In a word, while still pursuing pure electricity, Volvo has increased the choice of plug-in hybrid and mild hybrid.
In particular, despite the addition of hybrid versions, Volvo will launch a complete BEV lineup by 2030 and increase the proportion of BEVs as much as possible.
According to Volvo, full electrification remains an important pillar of its product strategy. The long-term goal remains unchanged, which remains to become an all-electric luxury car company and plan to achieve net-zero greenhouse gas emissions by 2040.
From this point of view, the addition of plug-in and light hybrid is a response to the current market demand.
As Yuan Xiaolin, Senior Vice President of Volvo Car Group and President and CEO of Volvo Cars Asia Pacific, said, demand is the essence.
Reality in China, the United States and Europe: Hybrid demand is growing stronger
In the second quarter of 2024, Volvo's BEV sales accounted for 26%, ranking first among all premium brands.
If plug-in hybrid models are included, they account for 48% of total sales. It is close to its new target of "between 50% and 60% of new energy vehicles by 2025".
If a person drinks water, he knows whether he is warm or cold. Taking the 48% apart, 26% pure electric and 22% hybrid, Volvo's own data shows that hybrid is still very important.
The domestic market data is also in line with this logic. According to the data of the Passenger Car Association, in the past two and a half years, the growth rate of pure electric vehicle sales has obviously not been as fast as that of hybrid models.
The United States market is even more exaggerated, the growth rate of the pure electric market is not in line with expectations, and there is even negative growth in June and July, but hybrid is popular.
Ford said its hybrid and electric vehicle sales rose 50 percent and 29 percent, respectively, in August compared to a year ago, while conventional fuel vehicles grew only 9.9 percent. The strong performance of hybrid vehicles in August was one of the important reasons why Ford returned to growth in the United States. Toyota too, with hybrids accounting for half of the total.
Even in the European Union, which loves small cars, hybrids are more fragrant.
According to the European Association of Automobile Manufacturers (ACEA), battery electric vehicle registrations fell by 10.8% in July and now account for only 12.1% of the total new car market. At the same time, the market share of hybrid vehicles increased to 32% from 25.5% last year.
Industry analysts in Europe pointed out that the decline in electric vehicle sales may be due to insufficient charging infrastructure, battery life and range anxiety, and the high cost of buying electric vehicles.
In Germany, for example, the direct reason for the significant cooling of electric vehicles is the price, the average price is close to 70,000 euros; Germany eliminated subsidies for electric vehicles in December, up to 4,500 euros.
The United States is similar, plus factors such as imperfect charging infrastructure. If the Republican Party wins the United States election, it will be even more bearish for pure electric vehicles.
Flexible response, a richer product portfolio
The enthusiasm for pure electric consumption is cold, and the pace of electrification transformation of car companies cannot, of course, be a sword.
Volvo was the first luxury brand to announce a full electrification transition, announcing its electrification strategy in 2017.
In order to implement carbon reduction, in 2021, a two-step target was clarified: to expand the proportion of pure electric vehicle sales to 50% by 2025; The company plans to transform into an all-electric vehicle brand by 2030.
At that time, Volvo said that the goal was determined because of the rapid increase in the demand for pure electric vehicles at that time, and the shrinking of the fuel vehicle market. On the other hand, it is expected that charging facilities will develop significantly.
Now, not all of these expectations have come true.
Jim · Rowan, CEO of Volvo Cars, said: "We have always been committed to driving the green transformation of the automotive industry and have set ambitious targets for this. However, the recent slowdown in demand for electric vehicles in Europe and changes in government subsidies have necessitated a re-examination and adjustment of our strategy. ”
Volvo said challenges include the slower pace of charging infrastructure and the removal of incentives by some regional governments. and the recent imposition of tariffs on electric vehicles in various markets, creating additional uncertainty.
Thomas · Peckron, vice chairman of the Germany Association of the Automotive Industry, pointed out that the demand for the automotive market is slowing down, and the large investment in electric vehicle research and development is a great challenge to the profitability of enterprises.
Therefore, many multinational car companies have chosen to adjust their "electrification" strategy and maintain the "dual line" of fuel vehicles and electric vehicles.
Many European and American automakers, including Mercedes-Benz, Volkswagen, Ford, and General Motors, have adjusted their EV transformation strategies.
Mercedes-Benz announced at this year's annual earnings conference that it will no longer adhere to the 2030 all-electric plan in view of the fact that the popularity of new energy vehicles has not reached expectations, and at the same time promise to continue to improve the production of fuel vehicles. Porsche has announced that it has abandoned its goal of having electric vehicles account for 80 percent of new car sales by 2030.
Reflected in the product matrix, it will bring a richer combination of kinetic energy configuration.
Through the cycle, a more long-termist route choice
At the just-concluded Chengdu Auto Show, Volvo brought the plug-in hybrid family XC60 plug-in hybrid, S60 plug-in hybrid, XC90 plug-in hybrid, S90 plug-in hybrid and other models, as well as EM90 and EX30 two pure electric models.
Volvo's plug-in hybrid did not choose the easier P2 architecture like other European brands, but chose the P1+P4 technical route with a better experience. Equipped with a 2.0T high-power engine, combined output, and intelligent four-wheel drive, it creates excellent performance comparable to that of a supercar.
For users with a budget of more than 500,000 yuan, power performance and handling limits are more important than fuel consumption.
With the support of the high-efficiency battery pack and large-capacity fuel tank design, the comprehensive range can easily exceed 1,000 kilometers when fully fueled and fully charged.
Whether electric or hybrid, safety is a success tag that Volvo will never give up. The Volvo plug-in hybrid model on display at the Chengdu Motor Show focuses on a full-dimensional safety experience.
"Volvo wanted to create a deep connection with the customer through a sense of security, and to create an emotional connection with the customer, not just to provide physical security." Yu Kexin, President of Volvo Cars Greater China Sales Company, said.
Based on the original architecture, the Volvo plug-in hybrid family adopts the layout of front oil and rear electricity, and the battery is in the middle, and cooperates with Volvo's unique boron steel body to achieve multiple battery structure protection.
It is reported that next year will be the first year of Volvo's entire new energy transformation, and a large number of new hybrid products will be launched.
epilogue
Heraclitus, a famous dialectic master in ancient Greece, famously said, "One cannot step into the same river twice."
The world is changing all the time, and future-based strategies are based on expectations that cannot be absolutely certain.
It is not so much that the expectations of car companies for pure electric demand a few years ago were inaccurate, but that there are many non-market factors that cannot be estimated.
For example, the evolutionary potential of hybrid technology itself, the evolution of war, social ideology, and the influence of political black swans.
These ambitious environmental factors can sometimes have a tangible impact, such as the surge in electricity prices in the EU over the past two years and the reduction of subsidies for pure electricity......
And a good company should have enough technical long-termism and flexibility. Going through the cycle and following the trend is just like Volvo's choice.