Volvo Will Phase Out Gas-Powered Cars By 2019

On June 4, 2017 Swedish automobile manufacturer Volvo announced it plans to phase out exclusively gas-powered cars by 2019, and will instead only offer hybrid or electric models.

Although most other major automakers have an electric car on the market, Volvo is the first to abandon gas-powered cars outright.

Liberal magazines and newspapers are praising Volvo, calling the move a bold step in the fight against climate change.

However, we believe this will hurt Volvo in the long run by limiting its market-share and growth beyond the renewable energy “safe space” that is Europe.

The fact is that the vast majority of the world lacks stable access to electrical energy—not to mention the expansive infrastructure electric vehicles require. Volvo is not going to be a bestseller in Asia or Africa anytime soon.

Beyond that, growth in the North American market has been driven almost exclusively by demand for large SUV’s and trucks. This has been the case for decades. Interestingly, Chinese markets are beginning to follow-suit: demand for large, gas-guzzling vehicles is rising dramatically in China.

Were Volvo to behave like a normal company, looking out for its shareholder’s best interests, one would imagine they would be pushing their own large vehicles to market: they’re more profitable than cars, and have a higher demand.

But no, Volvo, much like Sweden itself, is primarily interested in flash over substance. It wants to look progressive, rather than make economic progress.