Volvo Cars reports strong first-half-year sales in 2021

Volvo Cars has enjoyed its strongest ever first-half-year sales in the first six months of 2021, selling 380,757 cars globally, which is an increase of 41 per cent compared with the first half of last year.

The increase was predominantly driven by strong demand in China, the US and Europe, with all of these regions reporting double-digit growth compared with last year during the effects of the COVID-19 pandemic.

In June, Volvo Cars sold 68,224 cars, which is an increase of 11 per cent compared with June last year.

The number of Volvo cars sold online increased more than fivefold compared with the same period last year, driven by rising customer demand with Volvo’s Recharge line-up of chargeable models, with a fully electric or plug-in hybrid powertrain continuing to be popular, and accounting for 24.6 per cent of all Volvo cars sold globally during this period. When compared with the first half of 2020, the share of Recharge models increased by almost 150 per cent.

Sales in the US reached 63,754 cars in the first six months of the year, up 47.4 per cent compared with the same period last year, while sales in China were 95,252 in the first half of the year, which is an increase of 44.9 per cent compared with last year. European sales grew by 35.4 per cent, with 166,822 cars sold, the increase being mainly due to strong performance in the UK.

Volkswagen achieves second highest monthly market share in Europe since 2001

The European new car market saw an increase in total volume of 73 per cent in May this year compared with May 2020. Data from JATO Dynamics for 26 European markets, shows that sales volumes totalled 1,073,987 units, taking the year-to-date total to 5,150,831 units. However, despite the increase, volume was still 25 per cent lower than May 2019.

Volkswagen has performed particularly well, securing the second highest monthly market share since 2001, taking a 28.14 per cent of the market in May. Last April Volkswagen managed to secure 29.23 per cent as rival’s sales were hit harder by the pandemic in Europe.

The good results are due to strong performances from Audi, Skoda, Seat, and Cupra, as well as being boosted by increasing consumer demand for EVs and SUVs, with Volkswagen now leading across both segments in Europe.

EVs took a record share of registrations in May with 16 per cent, while SUVs made up almost 45 per cent of the total volume.

A total of 171,415 pure electric cars and plug-in hybrids were registered, an increase of 279 per cent compared with May 2020. BEVs totalled 83,700 (+261%), and PHEVs 87,700 (+299%) with the market share for SUVs increasing from 40.2 per cent in May 2020 to 44.6 per cent last month.

Nissan’s battery investment at Sunderland

Following the news that Nissan is to invest in more battery production at its UK production hub in Sunderland, GlobalData’s David Leggett commented:

“There are a number of big decision-making drivers here for Nissan, partly industry trends driven and partly specific to the circumstances of the plant in the UK.

“For the automotive industry, it is very clear that we are seeing a transformative energy transition from the prevalence of the internal combustion engine (ICE) to electrified and battery electric vehicles (BEVs). All vehicle manufacturers must address that fundamental shift over the next decade and that means both introducing new electric vehicles and ensuring supply chain capabilities for key components such as batteries.

“High-value lithium-ion batteries are, by their nature, heavy and vehicle manufacturers want to avoid long-distance logistics, preferring to manufacture the battery packs close to the vehicle manufacturing and final assembly plant.

“However, there are also important UK-specific factors at work in Nissan’s decision. The Nissan plant in Sunderland is heavily geared to supplying customers in the EU. From 2024, under the terms of the UK-EU’s Brexit trade deal struck at the end of last year, rules of origin requirements are raised and they get ratcheted up further thereafter. That means to qualify for tariff-free circulation in Britain, local content (UK and EU sourced components) needs to be higher than currently on electric vehicles made by Nissan in Britain. Nissan will prefer to meet that requirement with UK-made batteries rather than the alternative of long-distance import from potential suppliers on the continent.

“How much support from the UK government has Nissan factored in? That’s difficult to measure right now, but the UK has set an ambitious target for decarbonising its economy (with no pure ICE vehicles on sale from 2030) and the UK government has stressed the need for ‘levelling up’ the economic position of regions across the UK. Nissan’s Sunderland plant is a core economic asset in the relatively underprivileged northeast of England. There can be little doubt that London will give a huge welcome for this Nissan announcement and will have wanted to do anything it could to get that investment over the line. Nissan has been in a sweet spot for any negotiations on support measures.

“However, as the industry transitions to BEVs from today’s low market penetration (currently under 10% of new car sales for BEVs in Britain) there is still a long way to go for the UK in terms of being globally competitive and having sufficient supply chain manufacturing capacity – especially in batteries – to meet the vehicle manufacturers’ needs. Today’s Nissan announcement is a start. Make no mistake though, the UK is faced with very serious competition from future high-volume factories across the English Channel.”