Volvo Cars CEO Jim Rowan photographed in Nov. 2022. The company wants every car it sells to be fully electric by the year 2030.
Anders Wiklund | AFP | Getty Images
Volvo Cars does not plan to use autonomous driving technology from Tesla and will instead focus on developing its own systems, according to the company’s CEO.
Back in June, the Gothenburg-headquartered carmaker said it had inked an agreement with Elon Musk’s firm that would give its electric vehicles access to 12,000 Tesla Superchargers in the U.S., Mexico and Canada.
Speaking to CNBC’s “Squawk Box Europe” on Thursday morning, Volvo Cars chief Jim Rowan was asked whether this meant the business would consider using Tesla’s autonomous driving tech in the future.
“We’ve already made that decision in terms of what we want to control internally, in terms of our technology stack,” Rowan said.
“And we’ve chosen that we want to be in full control of our ADAS [advanced driver assistance systems], all the way up to full AD [autonomous driving] software,” he added.
“So we will continue to write that, we will continue to invest in that, and we’ll continue to develop that.”
In a sign of how the company’s strategy is taking shape, Volvo Cars announced late last year that it had taken full ownership of Zenseact, a business specializing in AD software.
Rowan was speaking to CNBC after Volvo Cars reported second-quarter results. The company said earnings before interest and taxes were 5 billion Swedish krona (around $487.5 million) compared to 10.8 billion Swedish krona in the second quarter of 2022.
“During the quarter, the company reported a continued strong sales performance in electric cars,” it said in a statement accompanying its earnings report. “Sales of fully electric Volvo car models increased by 178 per cent year-on-year during the quarter and accounted for 16 per cent of its total share.”
Volvo Cars’ longer-term electrification strategy is centered around every car it sells being fully electric by the year 2030. This would mean a phase-out of vehicles using internal combustion engines, a category that includes hybrids.
Supply chain challenges
The past few years have seen the automotive industry suffer issues related to supply chains and the cost of materials crucial to the production of electric vehicles.
During his interview with CNBC, Rowan gave an overview of the current state of play. “Last year we saw lithium spike quite dramatically, that’s now come down substantially from its peak,” he said.
“It went from about 10 to about $110 per kilo and now it’s down … below, somewhere between 30 and 40 [dollars],” he added. “So we’re starting to see that normalize, and I think that will keep reducing through the course of this year.”
Rowan also described semiconductors as being “patchy” in 2022 but “much, much better this year.”
This had been shown in Volvo Cars own output, he said. “We manufactured over 50% more cars this quarter than we did in the same quarter last year.”
He added that 2022 had also been affected by Covid lockdowns. “If you remember, Shanghai was locked down for almost 60 days — we had a lot of the suppliers in Shanghai, and that was an effect there,” Rowan said.
“So we’re seeing that bounce back really quickly for us.”