Volvo wants to make sure the Volvo and Polestar brands are major players in the electric vehicle space and took some major steps today to make sure that plan never runs out of juice.
The Swedish brand owned by Chinese company Geely announced today it has signed long-term agreements with two major lithium-ion battery makers: CATL of China and LG Chem of South Korea. Unlike Tesla which makes its own batteries at the Gigafactory, Volvo has cemented a steady supply for the next decade as the automotive world races toward electrification.
Volvo has ambitious plans. It raised eyebrows when it announced in 2017 that all new Volvo models launched from 2019 on would have some degree of electrification, mostly hybrids initially. Leadership upped the ante when it announced the goal of fully electric cars making up half its global sales by 2025. Polestar was created as an electric brand. It started with a hybrid but all subsequent models will be electric only.
“The future of Volvo Cars is electric and we are firmly committed to moving beyond the internal combustion engine,” said Håkan Samuelsson, president and CEO of Volvo Cars. “Today’s agreements with CATL and LG Chem demonstrate how we will reach our ambitious electrification targets.”
All Volvos ride on one of two platforms: the Compact Modular Architecture (CMA) for the smaller 40 series and the Scalable Product Architecture (SPA) for everything else. The new battery deal will cover the current CMA platform including the first electric Volvo, the XC40, which currently has a plug-in hybrid option. The electric XC40 will be built in Ghent, Belgium, where Volvo is building its first battery assembly line. Construction will be done by the end of the year. Also on CMA is the electric Polestar 2 and some models sold by Lynk & Co, also owned by Geely, all of which will be built at a plant in Luqiao, China.