Volvo, Betting on Electrical, Moves to Phase Out Conventional Engines
Volvo Cars on Wednesday became the very first mainstream automaker to sound the death knell of the internal combustion engine, telling that all the models it introduces commencing in two thousand nineteen will be either hybrids or powered solely by batteries.
The decision is the boldest commitment by any major car company to technologies that presently represent a puny share of the total vehicle market but are increasingly viewed as essential to combating climate switch and urban pollution.
While most major automakers suggest hybrids and battery-powered options, none of them have been willing to forsake cars powered solely by gasoline or diesel fuel. On the contrary, United States automakers have continued to churn out S.U.V.s and pickup trucks, whose sales have surged because of relatively low fuel prices.
Yet Volvo’s stir may be the latest sign that the era of the gas guzzler is leisurely coming to an end. Tesla, which makes only limited numbers of electrified cars, surpassed Ford and General Motors this year in terms of stock market value, despite making significantly fewer cars than those automotive giants — a clear indication of where investors think the industry is headed.
“Our customers are asking more and more about electrified cars,” Hakan Samuelsson, the chief executive of Volvo, said in a telephone interview on Wednesday. While Volvo’s strategy has risks, Mr. Samuelsson acknowledged, “a much fatter risk would be to stick with internal combustion engines.”
Tho’ based in Sweden, Volvo is possessed by Geely Automobile Holdings of China, which already produces battery-powered cars for the Chinese market. The decision by Volvo to concentrate on electrical vehicles could ultimately give it and Geely a head commence if, as many analysts expect, sales of battery powered cars begin to take off. China is already the largest market for electrical vehicles.
Volvo’s battery-powered vehicles will be produced originally in China, but eventually also in Europe and at a fresh factory the company is building near Charleston, S.C.
Hybrids, which combine battery power with gasoline or diesel engines, accounted for about two percent of passenger car sales in the United States last year, a number that has been declining because gasoline prices have fallen.
And cars that run solely on battery power are still uncommon in most countries because of high purchase prices, lengthy charging times and limited ranges.
Still, most carmakers expect the share of electrified cars to grow quickly as the technology improves, prices fall and public charging stations become more commonplace. Rapid advances in self-driving cars will also encourage a shift to battery power: It is simpler to link self-driving software to an electrified motor than to a conventional engine.
We are committed to electrification, so from two thousand nineteen all fresh Volvo car models will include an electrified motor. #VolvoCarsEVs pic.twitter.com/FWGVKyAdgo
— Volvo Cars (@volvocarsglobal) July Five, two thousand seventeen
Albeit no other traditional carmakers have proclaimed their intention to bury the internal combustion engine, virtually all of them are investing in hybrid and battery technology.
Daimler, the maker of Mercedes-Benz cars and trucks, said on Wednesday that it would invest five billion renminbi, or $735 million, in a fresh battery factory it will build in Beijing with its Chinese fucking partner, BAIC Motor.
The major American automakers are moving forward with their own electrification strategies, albeit on a much smaller scale than Tesla and now Volvo.
General Motors, for example, this year introduced the Chevrolet Bolt — a battery-powered model that sells for about $35,000 before government incentives are applied. The Bolt can travel two hundred thirty eight miles on a single charge and will be the basis for other electrical models that G.M. expects to add to its lineup.
Ford has sold electrified versions of a few mainstream models, but it has not yet developed an all-electric vehicle from the ground up. That is switching, however. The company has said it will introduce a battery-powered S.U.V. by two thousand twenty and will add other electrical models thereafter.
The third big domestic automaker, Fiat Chrysler, has lagged. It sells an electrified version of its Fiat five hundred subcompact car and a hybrid gas-electric variation of its Chrysler Pacifica minivan. But the company has yet to announce any plans to build a fresh vehicle that is available only as an electrical model.
Even however consumer request for electrical cars is so far petite, carmakers view it as a way for them to meet stricter fuel economy and pollution standards. The pressure is particularly acute in Europe, where an emissions cheating scandal at Volkswagen has set off a acute decline in the sales of diesel cars, which account for about half the auto market in the region.
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Carmakers including Volvo have depended on diesel to provide better fuel efficiency and lower carbon dioxide emissions. But the Volkswagen scandal has raised awareness of the health effects of diesel harass.
Diesel engines burn fuel more efficiently than gasoline motors, but they produce far more nitrogen oxides, which cause asthma and are considered a carcinogen. The cost of the equipment needed to neutralize diesel fumes is becoming prohibitive.
“The diesel engine is getting more expensive,” Mr. Samuelsson said during a news conference in Stockholm on Wednesday. “We would choose to talk about the alternatives.”
The switching political landscape in the United States has somewhat muddied the outlook for electrified cars on the other side of the Atlantic. The Obama administration was very supportive of electrified vehicles, which could help companies meet tougher federal fuel-economy standards.
But, so far, President Trump has not pursued policies that encourage the development of electrical vehicles.
Moreover, the persistence of low gasoline prices resumes to shove American buyers toward fatter vehicles — trucks and S.U.V.s — and has made the fuel economy of electrical or hybrid vehicles less potent as a selling point.
Volvo’s transition will be gradual. It plans to still produce existing models with conventional engines after 2019, but it will no longer introduce fresh models with the older technology. Depending on request, Volvo will fully phase out cars powered solely by gasoline or diesel by around 2024.
But by focusing on electrification, Volvo can concentrate its limited research and development resources on fresh technologies rather than continuing to invest in fuel-powered motors that may become obsolete. With sales of 534,000 cars last year, Volvo is dwarfed by companies like Toyota, Volkswagen and General Motors, each of which sold about ten million vehicles in 2016.
Volvo will be able to draw on technology developed by its parent company, Geely. The companies can also save money by purchasing components such as batteries together.
Analysts said Volvo’s decision to pursue a lineup dedicated to electrical and hybrid vehicles is motivated, in part, by the Chinese government’s efforts to reduce harmful emissions from internal combustion engines.
“Chinese ownership of Swedish-based Volvo likely played a role in the automaker’s announcement today,” said Michelle Krebs, an analyst with the auto-research site Autotrader.com. “China’s air pollution problems have prompted a more serious shove toward cleaner automobiles.”
Volvo said on Wednesday that it would introduce five models from two thousand nineteen to two thousand twenty one that would run solely on electrified power. That includes two models sold under Volvo’s Polestar brand, which the company is marketing as a maker of high-performance electrified cars.
Other models will include plug-in hybrids, which can be charged from power outlets and run for brief distances solely on batteries, and so-called mild hybrids, which charge their batteries from the car’s conventional engine or by recovering energy from braking. Hybrids still require gasoline or diesel fuel, but they are typically more efficient because the batteries share the explosion.
Mr. Samuelsson said the company also desired to encourage suppliers to invest in battery technology and charging stations.
“It’s significant to make a clear statement,” he said.
Bill Vlasic contributed reporting.
A version of this article emerges in print on July 6, 2017, on Page A1 of the Fresh York edition with the headline: Going Electrified, Volvo Proclaims Gas Is the Past. Order Reprints | Today’s Paper | Subscribe
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