Impact of Five Consecutive Quarters of Declining Electric Truck Demand
Initial Construction Scheduled for Next Year Delayed by 1-2 Years
Global commercial vehicle manufacturer 'Volvo Trucks' is postponing the construction of a new battery production plant in Sweden by at least 12 to 24 months. The plant was planned in anticipation of increasing electric vehicle demand, but recent global declines in electric truck demand have impacted the project.
On the 13th, major foreign media including the American daily The Wall Street Journal (WSJ) reported that Volvo Trucks decided to delay the groundbreaking of the new battery production plant in Sweden by 12 to 24 months. Two years ago, Volvo Trucks announced plans to build a new battery plant in Sweden to meet the growing demand for electric vehicles. According to the plan, construction was supposed to begin next year.
A Volvo Trucks representative stated, "We are gauging the timing of the (plant) construction to increase battery production capacity in line with the pace of (electric vehicle) demand growth." However, he added, "Whether this will affect the overall business, and if so, what kind of impact it will have, remains to be seen."
The reason Volvo Trucks is postponing the plant construction is due to the reduced demand for electric trucks. According to WSJ, Volvo Trucks holds a 56.9% market share of electric trucks in Europe, but globally, electric truck orders have declined for five consecutive quarters.
Meanwhile, this announcement came shortly after Sweden's Northvolt, Europe's largest battery company, announced plans to reduce staff and scale down operations due to the slump in the global electric vehicle market. Northvolt is reconsidering its growth strategy after the cancellation of a battery supply contract worth 2 billion euros (approximately 3 trillion won) with German automaker BMW. The company had planned to build new plants in Sweden, Germany, and Canada but reportedly faced difficulties due to an inability to increase production capacity.
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