Volvo EV Sales Slump

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Volvo Goes Back to Basics

Volvo has been navigating some rough waters recently. Their approach to electric vehicles (EVs) has been the stuff of headlines. Originally aiming to go all-electric by 2030, Volvo backtracked on that commitment last September. In retrospect, this decision seems prescient given the slump in their electric vehicle sales.

Sales Challenges

The start of 2025 hasn’t been kind to Volvo. Not only did overall sales drop by 7% from January to April, but electric vehicle sales took an especially hard hit, plummeting by 32% in April compared to the same month last year. In April 2024, Volvo sold 17,090 EVs which dipped to 11,697 in April 2025. This decline is substantial, and it’s raising eyebrows across the industry.

Electric Models in Focus

Interestingly, plug-in hybrid (PHEV) sales slightly increased by 2%, totaling 14,688 units, even as mild hybrid and internal combustion engine (ICE) vehicles saw a 5% decrease to 34,315 units. It appears that while EVs are taking a hit, plug-in hybrids are holding their ground. Combined, however, the fall in electric model sales dragged down overall figures by 16%, with total unit sales in April 2025 standing at 58,881 versus 65,838 the same month last year.

Production and Tariffs

Volvo’s production is also influenced by external economic factors. The company’s operations in the US are particularly affected by tariffs implemented during President Trump’s administration. Although the EX90 is produced locally in South Carolina, other models like the XC40, XC60, and the newly introduced EX30 face import duties, nudging their prices upward and potentially impacting sales.

Market Adjustments

To manage these challenges, Volvo is considering expanding production in the United States, potentially adding the XC60 or XC90 to its list of locally manufactured vehicles. This move might help them mitigate the cost impact of tariffs and make some models more competitive in the US market. Dropping the S90 from the American lineup due to these tariffs was a tough call, but it allows Volvo to focus on what can be more effectively managed domestically.

Leadership on the Move

At the helm to navigate these waters is Hakan Samuelsson, who was reappointed CEO. He returned in April on a temporary basis while the search for a long-term leader continues. Samuelsson’s experience and familiarity with Volvo’s challenges make him well-suited to potentially embolden the brand’s strategy during these pivoting times.

Driving Experience

When it comes to driving, Volvo’s EV models are renowned for offering a smooth and controlled ride, with a notable emphasis on safety features, true to Volvo’s heritage. Compared to traditional gasoline-powered vehicles and even some of its electric competitors, Volvo remains a polished choice for those who prioritize comfort and a serene cabin experience. They might lack the outright performance thrill of Tesla or Porsche EVs, but for many consumers, the balance of comfort, safety, and understated elegance is a winning formula.