Gothenburg, Sweden — Volvo Cars has unveiled a refined set of business ambitions aimed at driving growth and sustainability as the company navigates an evolving automotive landscape. This shift in strategy, revealed ahead of Volvo Cars’ Capital Markets Day, reflects the automaker’s commitment to value creation, with a pragmatic approach to fluctuating global market conditions.
Instead of setting fixed revenue targets, Volvo’s revised strategy aims to outpace growth in the premium car market through 2026. This ambition mirrors the company’s track record in recent years and comes with an updated goal of achieving an EBIT margin of 7-8% by 2026, amidst increased complexity in global trade and tariffs.
The company also remains focused on achieving cash flow neutrality over the next two years, with a projection of strong free cash flow beginning in 2026. These financial targets align with the company’s ongoing investment in innovation, expected to boost profitability and support long-term growth.
Volvo’s electrification journey continues to lead the industry. The automaker has set an ambitious target for 50-60% of its global sales to be electrified vehicles by 2025, including both fully electric and plug-in hybrid models. By 2030, electrified cars are expected to represent 90-100% of global sales, leaving a small allowance for mild hybrids if necessary.
In tandem with its electrification goals, Volvo is also advancing its environmental targets, aiming to reduce CO2 emissions per vehicle by 30-35% by 2025, compared to 2018 levels. By 2030, the company seeks to slash emissions by 65-75%. Volvo plans to collaborate closely with suppliers to cut emissions across its supply chain, reflecting its continued leadership in the automotive industry’s green transition.
Looking beyond the current investment phase, Volvo hinted at potential shareholder returns, with more details expected in the near future.
“We are at an exciting crossroads,” said Jim Rowan, CEO of Volvo Cars. “Today’s sharpened ambitions reflect our dedication to driving business value while remaining true to our mission of sustainability and progress.”
With its sights set on sustainable innovation and a profitable future, Volvo is positioning itself for long-term success in a rapidly changing market.
