Volvo Cars CEO: This company's future comes down to electrification

Good morning. Yeah, first I think we have a very challenging market, especially in China, very tough competition. All our European colleagues have the same problem, and we also had some incentives on the market for EV cars that have been discontinued in the US and also in China. So I mean, very challenging external environment. I would say that is really the explanation for the revenue figures. But internally we have had very good work done with lowering our cost and securing a positive cash flow. So that I would highlight as the most important positive things that we have reached during the year. We set out to really be positive cash flow for 2025, which was a tough target, and we achieved that together with a good cost reduction program. It's positive. Altogether, of course, bottom line 3.5% EBIT margin is not where we want to be, but looking at all factors, I think it's a reasonable result, but a good base to continue from. But now we need to grow and then, of course, improve our profitability in 2026.

No, it's tough, but I mean, positive is really our sales growth in electric cars. I mean, the future of Volvo is really depending on that we can transform the company into an electric one. In the last year, the market has been nervous, is it happening or not? I think now you see a clear development in direction to electric cars, and I think we're very glad we are on that. So we have 44% of all our cars that were last year chargeable, but we have missed a car for the mid-size segment, which is the biggest one. So now with the introduction of the new EX60, we are really doubling our addressable market segment for electric cars. I mean, that is really the key for growth for Volvo. We are not trying to grow with conventional cars, because that will be a disaster from a profitability point of view.

Yeah, I think it's mixed. But first, I don't want to avoid misunderstanding. I think if we are trying to grow with conventional cars, that will not work. That's why we need to grow with all electric cars. But as you know, everybody is not ready to be able to charge them today. And that's why I think we need the hybrids as a bridge. I'm quite sure the long-term solution is all electric cars. A really good car. There's only one problem: the range has been a bit limited and they are difficult to charge. And that's why we need a bridge solution with more long-range hybrids. So I think the US and China, I think we will see a rather big market for long-range hybrids, which we call the second-generation hybrids, and those we will have to really bridge into the future, which I'm sure will be all electric for Volvo. And then Volvo will be a bigger and more successful company. I mean, that is the main recipe for us to be more successful.