Volvo News: There May Be More to Volvo's Move to Electric and Hybrids

[William Maley]

Volvo stunned the world last Wednesday when they announced beginning in 2019, they would begin to phase out gas only vehicles and replacing them with hybrid and electric models. The company claims this strategy heralds "a new chapter in automotive history". This move is an about-face for the Swedish automaker. Previously, the company said electric vehicles didn't make a great business case. 

But there is more to this decision than meets the eye. Automotive News reports that a key reason for Volvo's electrification plans comes down to the increasing regulation on carbon dioxide (CO2) emissions in three key markets; Europe, China, and U.S. Tim Urquhart, principal analyst at IHS Markit tells AN that Volvo would struggle to meet the tougher targets on their larger vehicle without some sort of electrification.

"They've looked at the targets, and thought, we need to take serious action."

Another reason comes in part from the fallout of the Volkswagen diesel emission scandal. Automakers in Europe were using diesel engines as they produced 15 to 20 percent less CO2 emissions. But the backlash against diesel after the scandal has caused buyers to look elsewhere. In Germany for example, sales of diesel vehicles dropped to 39 percent in June - this figure was almost 50 percent the same time last year.

"Diesel was their main weapon of choice to hit these regulations. Now they have to come up with a plan B," said Matthias Schmidt, automotive market analyst for AID.

According to data from AID, 83 percent Volvo's 2016 sales in Europe were comprised of diesels. This is high when compared to BMW (73 percent), Mercedes-Benz (73 percent), and Audi (68 percent). Only Land Rover (96 percent) and Jaguar (84 percent) were higher.

Source: Automotive News (Subscription Required)

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[A Horse With No Name]

Wish we still had more diesels here in the interim, but this move makes an infinite amount of sense.

[G. David Felt]

This makes total sense and is understandable.

[smk4565]

Come 2030 there will be countries banning gas and diesel, France in 2040 is banning them, so they have to get on the path to electric.  Regulations will probably make gas engines extinct post 2030.

[G. David Felt]

49 minutes ago, smk4565 said:

Come 2030 there will be countries banning gas and diesel, France in 2040 is banning them, so they have to get on the path to electric.  Regulations will probably make gas engines extinct post 2030.

Should increase ev conversions as people who like their older auto want to keep them on the road.

[smk4565]

1 hour ago, dfelt said:

Should increase ev conversions as people who like their older auto want to keep them on the road.

I think they are banning sale of new gas powered cars, so the existing gas burners could go on oil 2050 by the time they all die out.

[riviera74]

For some reason, European regulators thought that diesel would solve all sorts of issues with emissions.  Now that this presumption is not the case, the crackdown (thanks to VW) has truly begun.  The march to EVs will certainly go a very long way into solving the CO2 problems that bedeviled regulators in the first place.  I suspect that many if not most European cars will be EV within the next 15 years or so, just because of CO2 regulations alone.  EVs will work wonders (against pollution) in our smoggiest cities such as LA and Beijing.

[G. David Felt]

12 hours ago, riviera74 said:

For some reason, European regulators thought that diesel would solve all sorts of issues with emissions.  Now that this presumption is not the case, the crackdown (thanks to VW) has truly begun.  The march to EVs will certainly go a very long way into solving the CO2 problems that bedeviled regulators in the first place.  I suspect that many if not most European cars will be EV within the next 15 years or so, just because of CO2 regulations alone.  EVs will work wonders (against pollution) in our smoggiest cities such as LA and Beijing.

Totally agree, plus Europe has one of the worst Acid Rain problems that has destroyed so much forest. This should help to ease that problem and clean it up.

[67impss]

IDK what percentage of power is generated by coal and NG as the ev percentage goes up...

[G. David Felt]

14 hours ago, 67impss said:

IDK what percentage of power is generated by coal and NG as the ev percentage goes up...

Plenty of stories but in 2015 the US had replaced most of the Coal plants with NG plants which is much more friendly to the planet.

http://www.cnbc.com/2015/07/14/natural-gas-tops-coal-as-top-source-of-electric-power-generation-in-us.html

https://www.eia.gov/todayinenergy/detail.php?id=25392

Interesting is that the news shows coal being surpassed by NG power plants in 2015 and our own gov being behind the times in data is saying they expect it to happen in 2016 end of year and the link above shows they published their findings in March of 2016.

 so much for gov accuracy.  

[67impss]

But I thought we were talking about Europe?

[riviera74]

12 hours ago, 67impss said:

But I thought we were talking about Europe?

We are.  So the power plant market in the US has shifted to natural gas replacing coal in a lot of cases.  That is a good thing.  More importantly, replacing diesels with EVs will shift the pollution profile away from autos to power plants and steel plants.  That is even better, especially given the acid rain problems Europe apparently still has.  Thirty years ago, the Northeastern United States had a serious acid rain problem.  The cure was shuttering a LOT of steel plants and other heavy industry and the significant reduction of coal burning over the last two decades.  Europe will need to deindustrialize in order to fully enjoy the lack of acid rain in their forests like we have in the United States.  Volvo's efforts can help with that.