Volvo Cars outlines strategy for building a stronger, more profitable company
Volvo Cars today outlines its strategy at an event for investors in Stockholm. During the event, which is livestreamed here, the company's management team will present how it is structurally building a company towards a long-term EBIT margin of over 8 per cent, strong positive cash flows and growth through electrification.
“Electrification is an opportunity for us and the main driver for growth,” says Håkan Samuelsson, President and CEO for Volvo Cars. “In a hypercompetitive industry, our unique relationship with Geely is also a strong asset for creating a better cost structure and developing attractive regional cars.”
An important enabler for electrified growth is the upcoming EX60 mid-size SUV, set to be revealed in January 2026 and based on the new SPA3 product architecture. The EX60 is Volvo Cars’ electric entry in the most important segment globally, enabling Volvo Cars to substantially increase its addressable market and electric market share. The company is confident that the coming EX60 is a game-changer in terms of price, performance and cost.
“The key building blocks for profitable electrified growth are variable cost reductions supported by hardware synergies with Geely, further indirect cost reductions and structurally lower investments,” says Fredrik Hansson, Chief Financial Officer.
The continued reduction of variable costs through intensified joint hardware sourcing in collaboration with Geely will reduce costs in the coming years. Volvo Cars will also benefit from structurally reduced indirect costs, including through an expanded use of the software stack powering all its software-defined cars. By expanding this to hybrids in future, this unlocks further efficiencies.
Additionally, stringent cost discipline following its SEK 18 billion cost and cash action plan will further support profitability. The company is finalising major investments in new technology and infrastructure, allowing it to reduce investments to an affordable level.
The direction is supported by Volvo Cars’ regionalised approach and commercial strategy with competitive and adapted offerings for each region. On top of that, Volvo Cars' new customer-centric sales model and new marketing approach will attract more customers to the Volvo brand at lower costs.
The Volvo Cars Strategy Update 2025 takes place later today between 9-12 CET and will be livestreamed online here.
