Volvo announces new business plans
Volvo Cars has announced new financial and operational ambitions that will position the company as a leading player in the global automotive business by the middle of the next decade.
On the operational side, it expects to generate half of all sales annually from fully electric cars, one third of all cars sold to be autonomous driving cars and half of all cars it offers to customers from its subscription service.
Volvo Cars expects these initiatives to transform its connection to its customer base, with the aim to build a total of more than five million direct consumer relationships by the middle of the next decade, creating new sources of recurring revenue. This will also offer the company far greater potential to develop connected and other services for customers.
‘Our customers’ expectations are changing rapidly. This means that Volvo Cars is also changing rapidly. These initiatives will help transform Volvo from being purely a car company to being a direct consumer services provider,’ said Hakan Samuelsson, president and chief executive of Volvo Cars.
On the financial side, Volvo Cars aims to generate premium-level profitability in line with other premium car makers, driven by increased sales and revenues across all three global sales regions, and a broader range of cars, including sales to the new segment of autonomous ride-hailing companies.
The company’s improved financial performance will also be driven increasingly in the future by industrial synergies generated with its affiliated partner companies.
Volvo Cars expects to benefit from lower procurement costs, shared development costs and economies of scale alongside Polestar, and LYNK & CO, in which Volvo Cars owns a 30% stake.