A self-confessed petrolhead, it took a while for Erik Severinson to warm to the idea of electric cars. “I’ve been in the automotive industry for 20 years,” says the chief commercial officer of Volvo Cars. “Of course, I’ve had my stick shifts, rear-wheel drives, slippery snow driving. I wasn’t convinced in the beginning—then I got into the electric car, and I understood.”
Severinson would love the public to understand the same thing—that electric is the future when it comes to what we decide to drive. If it isn’t, Volvo, which has committed to going fully electric by 2030, will be facing more scrutiny following a bumpy 2025.
It’s a tough battle. After an initial surge of interest, sales of electric vehicles in Europe and America have struggled. Overstretched governments have withdrawn subsidies, and Donald Trump has described sustainability initiatives as a “green scam.” The twin concerns of range anxiety and price continue to leave customers skeptical. With an ear open to the political mood music, the European Union has just announced the continent will move more slowly on phasing out internal combustion engines, a decision Severinson describes as “going backward.”
Volvo has suffered like any legacy automaker in a world where cars are now mobile smartphones as much as they are ways to travel from A to B. Its 2025 Q4 results, announced in February, saw U.S.-imposed tariffs and deep discounting affect profits. The company’s gross margin—the metric monitored most keenly by analysts—fell to 15.8%, compared with 20.4% in the third quarter. Volvo’s share price slumped by 20% to 22 sek (Swedish kronor; $2.38 usd), well below its 2021 ipo price of 53 sek ($5.73). Revenues fell to 357 billion sek ($38 billion), following a high of 400 billion sek ($42 billion) in 2024.
