The demand for electric vehicles (EVs) has decreased, in part, as a result of the slow roll-out of charging stations and the scarcity of affordable models. Additionally, major manufacturers are anticipating the impact of European tariffs on electric vehicles manufactured in China.
The 2030 EV goal is part of the World Economic Forum's global effort to combat climate change by eliminating fossil fuels.
In a statement, Volvo Cars said it now aims to have 90 percent of its fleet be fully electric or plug-in hybrid models by 2030. The manufacturer, which is majority-owned by China's Geely, said 10 percent would be mild hybrids. Volvo Cars added that plug-in hybrids would be a critical component to its future profit growth.
The company's shares were down 7.5 percent, approximately 4 percent lower before the announcement of reduced targets, as per Reuters.
Volvo Cars said the move was in response to customer demands and changing market conditions.
"It's a pragmatic approach...to help our customers go on the journey to full electrification," said Erik Severinsson, Volvo's head of strategy and chief product officer. "For many customers in many markets, it will be a stepwise journey."
CEO Jim Rowan told Reuters: "We are resolute in our belief that our future is electric. However, it is clear that the transition to electric will not be linear, and customers and markets are moving at different speeds."
The company, which takes pride in being an early adopter of electric vehicles, also urged lawmakers to encourage electrification with "stronger and more stable" government regulations.
