FRANKFURT — Volvo Cars became the first mainstream automaker to sound the death knell of the internal combustion engine, saying Wednesday that all the models it introduces from 2019 will be either hybrids or powered solely by batteries.
The decision is the boldest commitment by any major car company to technologies that now represent a small share of the total vehicle market, but that are increasingly viewed as essential to combating climate change and urban pollution.
While most major automakers offer hybrids and battery-powered options, none of them have been willing to forsake cars powered solely by gasoline or diesel fuel. On the contrary, U.S. automakers have continued to churn out SUVs and pickups, whose sales have surged because of relatively low fuel prices.
Yet Volvo’s move may be the latest sign that the era of the gas guzzler is slowly coming to an end. Tesla, which makes only limited numbers of electric cars, this year surpassed Ford and General Motors in terms of stock market value, despite making significantly fewer cars than those automotive giants — a clear indication of where investors think the industry is headed.
Most Read Business Stories
- Amid attacks and thefts, some retail workers want to fight back
- U.S. home-price growth decelerates for first time since 2021, including Seattle's
- EEOC: 2 fired for not joining company Christian prayer
- Seattle startup says it's close to cracking nuclear fusion; some experts say otherwise
- Microsoft’s $22 billion combat goggles get crucial field test with U.S. Army
“Our customers are asking more and more about electric cars,” Hakan Samuelsson, chief executive of Volvo, said Wednesday. While Volvo’s strategy has risks, Samuelsson acknowledged, “a much bigger risk would be to stick with internal combustion engines.”
Though based in Sweden, Volvo is owned by Geely Automobile Holdings of China, which already produces battery-powered cars for the Chinese market. The decision by Volvo to focus on electric vehicles could ultimately give it and Geely a head start if, as many analysts expect, sales of battery-powered cars begin to take off. China is already the largest market for electric vehicles.
Volvo’s battery-powered vehicles will be produced initially in China, but eventually also in Europe and a new factory the company is building near Charleston, South Carolina.
Hybrids, which combine battery power with gasoline or diesel engines, accounted for about 2 percent of passenger-car sales in the United States last year, a number that has been declining because gasoline prices have fallen.
And cars that run solely on battery power are still rare in most countries because of high purchase prices, lengthy charging times and limited ranges.
Still, most carmakers expect the share of electric cars to grow quickly as the technology improves, prices fall and public charging stations become more commonplace. Rapid advances in self-driving cars will also encourage a shift to battery power: It is simpler to link self-driving software to an electric motor than to a conventional engine.
Although no other traditional carmakers have declared their intention to bury the internal combustion engine, virtually all of them are investing in hybrid and battery technology.
Daimler, the maker of Mercedes-Benz cars and trucks, said Wednesday it would invest 5 billion yuan, or $735 million, in a new battery factory it will build in Beijing with its Chinese partner, BAIC Motor.
The major U.S. automakers are moving forward with their own electrification strategies, albeit on a much smaller scale than Tesla and now Volvo.
General Motors, for example, this year introduced the Chevrolet Bolt — a battery-powered model that sells for about $35,000 before government incentives are applied. The Bolt can travel 238 miles on a single charge and will be the basis for other electric models that GM expects to add to its lineup.
Ford has sold electric versions of a few mainstream models, but it has not developed an all-electric vehicle from the ground up. That is changing, however. The company has said it will introduce a battery-powered SUV by 2020 and will add other electric models thereafter.
The third big domestic automaker, Fiat Chrysler, has lagged.
It sells an electric version of its Fiat 500 subcompact car and a hybrid gas-electric variation of its Chrysler Pacifica minivan. But so far, the company has yet to announce any plans to build a new vehicle that is available only as an electric model.
Even though consumer demand for electric cars is so far small, carmakers see it as a way for them to meet stricter fuel economy and pollution standards.
The pressure is particularly acute in Europe, where an emissions cheating scandal at Volkswagen has set off a sharp decline in sales of diesel cars, which account for about half the auto market in the region.