Volvo Cars Unveils Plan to Strengthen Profitability and Drive Electric Growth

Volvo Cars outlines its updated strategy in Stockholm, aiming for long-term EBIT above 8% and growth through electrification, cost cuts, and regional expansion.

Volvo Cars unveiled its updated strategy in Stockholm, aiming to build a more resilient and profitable company. The management outlined plans to achieve a long-term EBIT margin above 8 percent and sustain growth through electrification and cost optimization.

President and CEO Hakan Samuelsson emphasized that the shift to electric mobility remains the main driver of Volvo’s business. The upcoming mid-size SUV, the EX60, set for its debut on January 21, 2026, will be the first Volvo model based on the new SPA3 platform. This architecture is designed to improve production efficiency through modular design, megacasting, and unified technology systems.

The company continues to strengthen its partnership with Geely, focusing on joint procurement and shared components to reduce variable costs. At the same time, Volvo is cutting indirect expenses by streamlining its workforce and expanding the use of a common software platform across its vehicle range. Under the SEK 18 billion Cost and Cash Action Plan, savings are expected to materialize in 2026.

Volvo Cars also notes that major investments in new technologies and infrastructure are nearing completion, allowing capital expenditure to be maintained at a manageable level. Production is becoming increasingly regionalized — XC60 manufacturing is moving to the United States to mitigate tariff exposure and boost competitiveness in the North American market.

Although the company has not specified when it expects to surpass the 8 percent margin threshold, analysts point out that progress will depend on factors such as global raw material prices, U.S. trade policies, and the pace of electric vehicle demand. Still, Volvo Cars remains confident: with the launch of the EX60 and the SPA3-based technology stack, it aims to strengthen its presence in key regions and prove that electrification can be both sustainable and profitable.