The Sweden-headquartered organization reported that Volvo Cars experienced a 10% increase in sales, reaching 53,402 cars in January compared to the previous year. This growth was attributed to a significant 40% surge in sales for fully electric models in the European market. The performance boosted the company’s share of total global sales of electrified vehicles to 17%, a record for Volvo.
It also reflected strong demand for the firm’s Recharge models, including fully electric and plug-in hybrid models. Those accounted for a third of Volvo’s overall sales in the region during the month.
The company, which is majority-owned by China’s Geely Holding (0175. HK) GELY, has an ambitious plan to become a leading premium electric car maker and eventually phase out any model in its portfolio with an internal combustion engine by 2025. That reflects the company’s long-term commitment to consistently reducing its life cycle carbon footprint and ambition to be climate-neutral by 2040.
Geely, founded by business mogul Li Shufu, is one of several Chinese companies seeking to enter the automotive market. Others, including EV maker BYD and SUV maker LYNX, are expanding their presence in the United States, a major growth market.
Established in 1927, Volvo has become one of the world’s most well-known brands. It has built its safety reputation by focusing on crash tests that simulate real-world driving situations. In recent years, the firm has branched into other areas, such as luxury and environmental sustainability.
Last week, the company said it would pause output at its plant in Gent, Belgium, due to security concerns in the Red Sea. It did not specify what impact that would have on car deliveries or production targets, and it is not expected to affect global sales or the company’s other European operations.
The pause is due to the ongoing conflict in Yemen between Saudi Arabia and Iran-backed Houthi rebels, which has disrupted one of the leading shipping routes between Asia and Europe, requiring cargo ships to travel via southern Africa instead of through the Suez Canal. That is expected to indirectly impact global supply chains, which could delay parts shipments and slow production. The company, which sells its cars in more than 100 countries, said it would continue to focus on cost efficiencies and resource optimization as part of its transformation. It added that those efforts had begun to bear fruit and were expected to provide further benefits in the coming months. The company is scheduled to report quarterly results next week. Its shares closed up 1.1% at $59.77 on the New York Stock Exchange. The company’s stock was down 5% in the past 12 months. Copyright Reuters. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Reuters, the Associated Press, and Reuters Japan are not responsible for any errors or inaccuracies in this article.