The Volvo Cars manufacturing plant in Chengdu, the company’s largest in China, is now powered by 100 per cent renewable electricity, taking the company’s global renewable electricity mix in its manufacturing network to 80 per cent.
The 100 per cent renewable electricity mix in Chengdu is the result of a newly signed supply contract and will reduce the plant’s CO2 emissions by more than 11,000 tonnes per year.
It is the latest concrete step towards Volvo Cars’ ambition to have climate-neutral manufacturing by 2025, part of a wider climate plan that aims to reduce the overall carbon footprint per car by 40 per cent between 2018 and 2025. By 2040, Volvo Cars aims to be a climate-neutral company.
The new electricity contract is also in line with broader ambitions in China to reduce carbon emissions from industry and reduce the carbon footprint resulting from energy generation.
Until recently, the Chengdu plant already sourced 70 per cent of its electricity from renewable sources. The new contract addresses the last 30 per cent.
Under the new contract, around 65 per cent of the electricity supply comes from hydropower, while the remainder comes from solar power, wind power and other renewable sources.
“Our ambition is to reduce our carbon footprint through concrete, tangible actions,” said Javier Varela, Head of Industrial Operations and Quality at Volvo Cars. “Securing a fully renewable electricity supply for our largest plant in China is a significant milestone and underlines our commitment to taking concrete, meaningful action.”
Volvo Cars is constantly working to reduce the carbon footprint of its manufacturing network and has reached a number of milestones in recent years. All its European plants have had a climate-neutral electricity supply since 2008, while the engine plant in Skövde, Sweden, was the first in the company’s network to become completely climate neutral in 2018.
At the Ghent plant in Belgium, Volvo Cars installed 15,000 solar panels in 2018, the first large-scale introduction of solar energy in its global manufacturing network.
These and other measures are part of the climate plan Volvo Cars launched late last year, one of the most ambitious in the automotive industry. The centrepiece of the plan is Volvo Cars’ ambition to generate 50 per cent of global sales from fully electric cars by 2025, with the rest hybrids.
Yet the plan goes beyond addressing tailpipe emissions through all-out electrification and also seeks to tackle carbon emissions in the company’s wider operations, its supply chain and through recycling and reuse of materials.
Volvo Car Group in 2019
For the 2019 financial year, Volvo Car Group recorded an operating profit of 14.3 BSEK (14.2 BSEK in 2018). Revenue over the period amounted to 274.1 BSEK (252.7 BSEK). For the full year 2019, global sales reached a record 705,452 (642,253) cars, an increase of 9.8 per cent versus 2018. The results underline the comprehensive transformation of Volvo Cars’ finances and operations in recent years, positioning the company for its next growth phase.
About Volvo Car Group
Volvo Cars was founded in 1927. Today, it is one of the most well-known and respected premium car brands in the world, with sales of 705,452 cars in 2019 in about 100 countries. Volvo Cars has been under the ownership of the Zhejiang Geely Holding since 2010.
In 2019, Volvo Cars employed on average approximately 41,500 (41,500) full-time employees. Volvo Cars’ head office, product development, marketing and administration functions are mainly located in Gothenburg, Sweden. Volvo Cars’ head office for APAC is located in Shanghai. The company’s main car production plants are located in Gothenburg (Sweden), Ghent (Belgium), South Carolina (US), Chengdu and Daqing (China), while engines are manufactured in Skövde (Sweden) and Zhangjiakou (China), and body components in Olofström (Sweden).
Under its new company purpose, Volvo Cars aims to provide customers with the Freedom to Move in a personal, sustainable and safe way. This purpose is reflected into a number of business ambitions: for example, by the middle of this decade, it aims for half of its global sales to be fully electric cars and to establish five million direct consumer relationships. Volvo Cars is also committed to an ongoing reduction of its carbon footprint, with the ambition to be a climate-neutral company by 2040.