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Forget Tesla! Why Volvo is the car brand with the most to gain from rising electric car sales

Volvo has committed to going all-electric by 2026, so will need to make more progress towards that goal in 2024.

Unless you’ve been living under a rock, you will have noticed a sharp increase in the number of electric cars on the roads of Australia in 2023. Sales are up nearly 200 per cent and more than 80,000 new examples were sold in the first 11 months of the year (almost as many as hybrid vehicles).

But while Tesla is the most dominant player in that market, accounting for more than half of those sales, it’s not the brand with the most to win in 2024 if EV sales stay strong. Instead, that title belongs to Volvo, the Swedish luxury brand that has pinned all of its future hopes on EVs.

In case you missed it, Volvo Australia has announced that it will only offer EVs by 2026, ditching all of its petrol, diesel and hybrid powertrains in favour of being all-electric as soon as is feasible. It’s a bold strategy, but one I’ve previously praised as it provides Volvo with a chance to leapfrog its competitors who have more to lose and therefore are taking a slower, more conservative approach.

That’s not to say Volvo has nothing to lose, on the contrary the brand is arguably in its strongest position ever, as it’s on course to sell more than 10,000 cars for the second year in a row, after years of steady increasing sales. It now sits ahead of the likes of fellow premium players Land Rover and Porsche, even if it’s still a fair way behind the likes of Lexus, Audi and BMW.

Looking into its 2023 sales, there’s some very positive news for the brand. The new, all-electric C40 was a hit, enjoying nearly 300 per cent sales growth in first 11 months of the year and finding more than 1000 owners. Obviously 1000 sales isn’t a lot in the overall market, but for Volvo that’s roughly 10 per cent of its volume.

Arguably what was more impressive was the XC40 was tracking more than 15 per cent up year-to-date, which was coming off the back of a strong 2022. So much so that the XC40 was actually the best-selling model in its class for the first 11 months of 2023, besting the likes of the Audi Q3, BMW X1 and Mercedes-Benz GLA. That’s a very big deal for Volvo as it demonstrates that, given the right product, it can outperform the ‘Big Three’ German luxury brands.

The XC40 was tracking more than 15 per cent up year-to-date.

Even though Volvo won’t go all-electric until 2026, next year is shaping up as a potential make or break 12 months for the brand as it introduces arguably its most important model yet - the EX30.

This small SUV will line-up alongside the C40 Recharge and XC40 Recharge in an expanded EV portfolio, but more importantly, will give Volvo a direct rival to the likes of the popular Tesla Model Y. Obviously there’s little chance the EX30 will outsell the Tesla, given its dominant position, but if it can woo buyers away from the American brand, whilst also attracting would-be German prestige customers, Volvo’s electric future will be looking a lot brighter.

Volvo Australia management revealed back in September that it has already taken more than 800 pre-orders for the EX30, so there’s already interest and demand for the car.

Unfortunately plans to launch the XC90-replacing all-electric EX90 have been delayed and it now won’t launch globally until mid-’24, all but ruling it out for local sales next year. Instead it will be the EX30, C40 and XC40 that will (pardon the pun) lead the charge for Volvo’s electric transition in 2024.

Stephen Ottley
Contributing Journalist
Steve has been obsessed with all things automotive for as long as he can remember. Literally, his earliest memory is of a car. Having amassed an enviable Hot Wheels and...
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