Volvo will begin producing electric motors for all its cars beginning in 2019, becoming the first traditional automaker to forgo the combustion engine altogether.
The Swedish company, which has been making cars since 1927 and has in recent decades become famous for its station wagons and safety features, said Wednesday that the decision was prompted by the wishes of customers, describing it as "one of the most significant moves by any car maker."
Volvo said it aims to reach its target of selling 1 million electrified cars by 2025, with a range of models, including fully electric vehicles and hybrid cars.
"This announcement marks the end of the solely combustion engine-powered car," CEO Hakan Samuelsson said. "People increasingly demand electrified cars, and we want to respond to our customers' current and future needs."
Volvo, which since 2010 has been owned by Chinese firm Geely, will launch five fully electric car models between 2019 and 2021. Three of them will be Volvo models and two will be electrified cars from Polestar, Volvo Cars' performance car arm.
It also plans to supplement them with a range of gasoline and diesel plug-in hybrid and mild hybrid, or 48-volt, options on all models, which the company said would be one of the "broadest electrified car offerings of any car maker."
Volvo said in April that its first electric vehicle will be a Chinese-made compact car that starts deliveries in 2019. The model will be exported globally and be based on the platform of the company’s XC40 compact SUV. China is becoming the biggest market for electric cars, and authorities are looking at ambitious production quotas that would be enforced with fines on manufacturers.
Volvo has said it is committed to help improve the environment and make cities cleaner by reducing carbon emissions, aiming to have climate neutral manufacturing operations by 2025.
Last year, the company had record sales of 534,332 cars in 100 countries, up more than 6 percent from 2015.
Conventional automakers from BMW AG to Volkswagen AG’s Audi are electrifying their line-ups to meet tightening emissions regulations and better compete with segment pioneer Tesla Inc., which starts making its third model this week. In an effort to woo reluctant customers, manufacturers are offering longer driving ranges and more attractive designs.
BMW has said an electric model dubbed the iNext will replace the 7-Series as its flagship in 2021. Daimler AG’s Mercedes plans to release 10 new electric vehicles by 2022, earlier than previously announced. Both carmakers expect battery-powered cars to account for as much 25 percent of sales in about ten years. Audi has said every model line will have a hybrid or purely battery-powered variant by 2020.