Despite market pressure from electric vehicle giant, Tesla, Volvo Cars has announced that they have no plans to lower the prices of their electric vehicles. The statement came from the company’s Chief Executive, Jim Rowan, following the release of their fourth-quarter profits which showed a decline.
However, despite the drop in profit, Rowan emphasized that there was no need to cut prices as demand for Volvo’s electric cars remains strong and the company has a substantial order backlog for their full electric vehicles. The results also revealed that EV unit sales for Volvo tripled during the fourth quarter, with fully electric vehicles accounting for 18% of total sales during that period, compared to 6% the previous year.
“We don’t see (price cuts) at this point in time,” Rowan told Reuters. “Demand for our (battery electric vehicles) is the highest that we’ve ever seen, the backlog for that as well.”
“We don’t have any intention to reduce pricing.”
Tesla’s recent global price cuts on their electric vehicles (EVs) have sent shockwaves throughout the automotive industry. The cuts, which reached as high as 20%, are expected to have a significant impact on EV startups, particularly those in the US. Companies that focus solely on EVs, such as Polestar and Rivian, may be hit harder compared to established brands with a mixed range of vehicles.
In response to Tesla’s move, Ford has followed suit, reducing the price of its Mustang Mach-E SUV by up to $5,900. However, German automaker BMW has taken a different approach, increasing the retail price for certain models sold in China due to rising raw material and logistics costs.
These developments highlight the growing competitiveness of the EV market and the challenges that companies face in maintaining profitability while offering affordable prices to consumers. Only time will tell how the industry will respond and what the future holds for EV startups and established brands alike.
Henrik Fisker, the CEO of Fisker Inc., a US-based electric vehicle (EV) manufacturer, has stated that his company has no intentions of reducing prices. Fisker believes that their EVs are already priced competitively and that there have been no changes to their pricing since 2020, unlike some of their rivals who have raised prices multiple times.
Several other car manufacturers, including Volkswagen, Hyundai, Kia, and General Motors, have also reported that they have no plans to reduce prices.
However, suppliers in the EV industry are concerned that they may be pressured to cut prices to keep up with Tesla’s recent price reductions. Despite the recent price cuts in the market, some suppliers have not yet noticed a significant increase in EV production.
