Volvo Car Group has announced that it has signed multi-billion dollar battery supply deals with battery manufacturers CATL and LG Chem. These long term deals will ensure the supply of Lithium-Ion batteries over the next decade for upcoming Volvo and Polestar models. This move comes in accordance with Volvo's electrification strategy. The battery modules will be used in all models based on the Volvo's new SPA2 along with the existing CMA vehicle platforms. Back in 2017, the Swedish automaker said that from 2019 onwards, all Volvo cars are going to be electrified. The company is now aiming at ensuring that by 2025, 50% of its global sales account for all-electric models.
Håkan Samuelsson, president and CEO of Volvo Cars said that the agreements with CATL and LG Chem demonstrate how the company is going to meet its ambitious electrification targets. He added that the future of Volvo Cars is electric and that the carmaker is committed to moving away from using internal combustion engines.
The reason why Volvo chose CATL (China) and LG Chem (South Korea) is because both of these players are considered to be leading battery manufacturers and hold an impressive track record to supplying lithium-ion batteries to a number of automobile manufacturers.
Volvo's first all-electric vehicle is going to be a derivative of the XC40. The same will be manufactured at the automaker's plant in Ghent, Belgium. The assembly line for the same is currently under construction. The plant already manufactures the mild-hybrid variants of the XC40. This small SUV is based on Volvo's Compact Modular Architecture (CMA). The same platform is also used by the Polestar 2 fastback along with several models sold by LYNK & CO, Volvo’s sister brand which it co-owns with Geely.
The upcoming SPA2 is based on Volvo's SPA (Scalable Product Architecture) and is going to make its debut sometime within the next 3-4 years. The SPA currently underpins the latest generation of Volvo cars i.e. the 90 and 60 series.