If there's anything in the automotive industry moving fast aside from self-driving technology, it's this: electric vehicles. EV. Hybrid technology. Some may say it's the wave of the future given many still like the control and the ownership of the vehicle but with the added incentive that it's better for the environment, more streamlined, and cost-effective. Of course, Volvo thinks so, too, but you won't believe when they're seeing a market share with EV throughout the auto industry:
Volvo Is Looking at EV Profit Margins to Be Right on Top of Conventional Car Sales Within the Next Decade
That's coming up fast. Combustion engines are now going slow, undoubtedly -- so we're looking at a fast-moving innovation. Global automakers, in fact, will be seeing a $300B surge in spending over the next five to ten years but with some initial higher component costs.
Particularly, Volvo will be investing in 5% of its annual revenue, which is about $1B a year, just to fund development of not only EV, but self-driving technology. Be prepared for a gradual development, though -- as EV production isn't cost-effective in comparison with traditional manufacturing. Other factors such as the long-term cost savings of driving EV vehicles -- gas expenses, maintenance, and more -- would definitely offset the higher price of the newest technology, and that would also decrease margins for traditional sales.
This is why Volvo has a specific date in mind. Yes, within the decade, but would you like to know when Volvo may see profit margins right along with traditional car sales?
Volvo Is Estimating by 2025
You can expect at least a 50% market share of consumers purchasing vehicles. Half of them (or more) may be EV. This will be the new age of automotive technology, industry and retail. Imagine what that will do to the oil industry, the petrol industry. Gas stations will have to evolve. We're talking about a completely new financial eco-system here.
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