Volvo says goodbye to diesel with its latest XC90 SUV and looks to an electric future

Volvo Car AB bid adieu to an era with the unveiling of its final diesel-powered vehicle, the XC90 SUV, marking a pivotal shift towards an all-electric future slated for 2030. The symbolic moment took place at Volvo’s manufacturing hub in Torsland, Sweden, where the last of its diesel models rolled off the production line on a historic Tuesday night.

Eric Severinson, Volvo Car’s head of new cars and operational strategy, expressed confidence in the transition, affirming, “Even without diesel, we have very good offers for customers.”

While Volvo forges ahead, the automotive landscape remains varied in its response to electric propulsion. Competitors hesitate to commit to phasing out internal combustion engines, with some even scaling back electric vehicle (EV) initiatives. Mercedes-Benz Group AG revised its sales forecast, expecting a slower adoption of battery-powered cars, while Audi announced reductions in its EV lineup.

Volvo Car’s commitment to sustainability dates back to 2017 when it became the first major automaker to pledge a departure from fossil fuels. Since then, the company has introduced hybrid and all-electric models, marking significant strides in an evolving market. In Europe, diesel’s decline has been stark, plummeting from half of new sales nine years ago to a mere 14% in recent times.

The XC90, a flagship model instrumental in Volvo’s resurgence since 2014, will find its place of honor at the Volvo Museum in Gothenburg next month. As the curtains draw on the diesel era, attention pivots to Volvo’s electric offerings, epitomized by the all-electric EX90.

Diesel’s fall from grace, once championed as a cleaner alternative, suffered a fatal blow following the 2015 scandal involving Volkswagen AG’s emission-test cheating software. Concurrently, electric vehicle manufacturers in Europe face an uphill battle amidst subsidy reductions and heightened competition from industry giants like Tesla Inc. and emerging Chinese brands.

In navigating these challenges, Volvo Car remains resolute in its commitment to EVs, despite trimming costs and divesting from Polestar, an electric-car maker within Geely’s portfolio. Severinson emphasized Volvo’s unwavering dedication to green mobility, stating, “We believe our customers see the transition to green mobility as much as we do.”

As Volvo Car bids farewell to diesel, its final XC90 serves not just as a museum piece but as a symbol of a transformative journey towards a greener automotive future.

Source: Bloomberg