The subscription program will expand into a unique, online-only purchase experience.
Volvo decided to join the club of electric-only brands. It will get there by 2030 following what Tesla has done with its cars: online-only purchases. The different notes are that Volvo will still have dealers, and all vehicles will be sold under the Care By Volvo program.
Care By Volvo currently is a subscription program that treats cars as a service. In other words, you paid to use the car, and all services – such as insurance and maintenance – are included in the monthly payments.
If we got it right, Volvo would also sell its cars with the same services package, but it is not clear how the company plans to do that. If someone wants to buy their Volvos in cash, for example, Care By Volvo will probably be a compulsory package that will still demand customers to pay a fee every month. It will include “service, warranty, roadside assistance, as well as insurance where available and home charging options.”
That will help Volvo keep dealers alive when none of its future cars need as much maintenance as they currently do. The Electrified Garage – which Rich Benoit opened with his partners – proves that there’s maintenance to be done with EVs, but it is not as extensive and constant as that for combustion-engined vehicles.
Volvo dealerships will still be responsible for “selling, preparing, delivering, and servicing cars.” Selling will probably happen in computers at the dealerships for the customers that prefer to order the vehicles in a store. It looks pretty much like the agency model Volkswagen has adopted with its dealerships selling the ID.3.
Regarding the goal to become an electric-only brand, Volvo said it would only sell electric cars from 2030 on. Even its current plug-in hybrids will leave the building by then, which means the company will not sell anything with a combustion engine starting 2030. By 2025, it expects half of its sales will be of electric cars already, with the other half for the hybrids.
The image above shows Volvo will have seven electric vehicles by the middle of the decade. Apart from the XC40 Recharge, we can see a larger SUV to its right. Below, there's a crossover coupe, a smaller crossover coupe, and a sedan. In the last line, we see the smaller crossover with a conventional body and the flagship SUV, possibly an electric XC90.
Henrik Green, Volvo’s CTO (Chief Technology Officer), said, “there is no long-term future for cars with an internal combustion engine.” Considering car companies take about three years to develop a car, there is really no sense in developing vehicles with engines if many countries will ban them sooner or later.