Volvo Cars, the Swedish automaker owned by China’s Geely, has seen a remarkable financial upturn. In 2023, Volvo reported a surge in deliveries, hitting 708,000 cars and generating SEK 399.3 billion ($38.37 billion) in revenue—an impressive 21% jump from the previous year. Profit also experienced a significant boost, rising by 43% to SEK 25.6 billion ($2.46 billion), resulting in an increased operating margin from 5.4% to 6.4%.
A surprising highlight emerged from Volvo’s electric vehicle (EV) segment, with EV deliveries soaring by 70% in 2023, accounting for over 113,000 vehicles or 16% of total global sales. Volvo’s commitment to becoming a fully electric company by 2030 set it apart from peers, and structured investments over the years were credited for this success, according to Deputy CEO and Chief Commercial Officer Björn Annwall.
Volvo’s strategic focus on the premium end of the EV market, along with its flexibility in offering hybrid variants for most vehicles, contributed to the positive results. Björn Annwall highlighted that plug-in hybrids are gaining popularity as a transition to a fully electric future, especially in the United States.
Looking ahead, Volvo plans to introduce the smaller EX30 SUV and the larger three-row EX90 SUV, both eligible for federal EV tax credits and manufactured in Charleston, S.C. Additionally, Volvo announced a reduction in its ownership stake in Polestar, a pure EV brand majority-owned by Volvo. This move aims to optimize capital allocation for Volvo’s transformation into a fully electric future, with Geely Sweden Holding, a Geely subsidiary, potentially assuming the main owner responsibility for Polestar.
Despite the ownership adjustment, Volvo and Polestar will continue collaborating on engineering for their next-generation vehicles, producing cars at Volvo’s South Carolina factory and sharing some retailer networks. This strategic decision underscores Volvo’s commitment to maintaining leadership in the rapidly evolving automotive landscape.
