May 15, 2019
Charging up our electrification strategy with new battery suppliers
Our electrification strategy is as ambitious as it is straightforward: we want to grow our business by building the best premium electrified cars possible and make range anxiety a thing of the past. Back in 2017, we were the first traditional car maker to commit to full electrification, and by the middle of next decade we expect half of all our sales to be fully electric cars. But to build and sell lots of electrified cars, we also need lots of batteries.
Enter our two new partners. CATL, from China, and South Korean firm LG Chem will supply us with all the lithium ion batteries we need during the coming decade. Their battery modules will power all electrified Volvos and Polestars that we plan to launch during that period. Both CATL and LG Chem have a long track record in supplying the car industry with batteries.
Today’s announcement is an important piece of the puzzle to deliver on our electrification ambitions. Both LG Chem and CATL have battery factories in the US, China and Europe, which means that we have two suppliers available in each of our major manufacturing hubs. That offers flexibility: depending on market developments and customer demand, we can easily adjust production levels as required. Of course, the two companies also score well in terms of cost competitiveness.
Another important factor in these matters is sustainability. LG Chem and CATL share our ambitions in terms of limiting CO2 emissions and using renewable energy in their production facilities. They also promote transparency in their supply chain and are fully on board with our requirements in terms of responsible sourcing of raw materials.
So to sum up: signing up LG Chem and CATL as long-term partners is an important milestone as we continue to transform ourselves into a maker of electrified cars. It demonstrates again that we are serious: the future of Volvo is indeed electric. Learn more about our electrification strategy here.