Volvo sets sales record in second half of 2020

Volvo achieved record sales in the second half of 2020, despite the impact of the coronavirus pandemic, driven by continued growth in China and the US and increased demand for its plug-in hybrid models.

The Swedish firm, owned by Chinese giant Geely, sold 391,751 cars globally in the final six months of last year, an increase of 7.4% on the 364,626 sold in the same period of 2019. Although that was a new second-half record for Volvo, the impact of the Covid-19 pandemic on the first half of the year meant that the firm’s sales declined 6.2% year on year, with 661,713 cars sold worldwide.

Volvo also posted a record six-month profit of 9.5 billion SEK (£830 million) in the second half of 2020. The firm recorded a full-year profit of 8.5bn SEK (£740m), a 40.5% year-on-year fall.

Volvo’s second-half resurgence was driven by sales in China, where the whole car market recovered faster from the impact of Covid-19, and the US. The firm sold 166,617 cars in China across 2020, a 7.5% rise on the 154,961 units sold in 2019. Of that total, 100,876 were sold in the last six months of the year, a 15.7% rise on the second half of 2019. The firm also increased year-on-year sales in the US, with 110,129 sales in 2020 representing a 1.8% rise on 2019. 

In Europe, Volvo sold 288,325 cars in 2020, down 15.5% on 2019. But it did show a strong recovery in the second half of the year, with the 165,127 units sold in the region down just 0.9% on the same period in 2019.

Plug-in hybrid and full-electric models, sold under Volvo’s Recharge line, accounted for 19.8% of its sales in 2020, compared with 6.8% in 2019. The firm said Recharge models accounted for nearly a third of all cars sold in Europe.

The success of those electrified models meant Volvo and sibling firm Polestar met their European Union CO2 fleet average target. As a result, Volvo was able to reach a deal with Ford to enter a pooling agreement to help the American giant escape an EU fine due to missing its target because of problems with the Kuga PHEV.

Demand increased substantially for the Volvo XC40, with the 185,406 examples sold representing a 32.6% year-on-year increase. The larger XC60 remained Volvo’s best-selling model, with 191,696 sold. 

Volvo also said online sales systems and the success of its new Care by Volvo subscription scheme helped to maintain sales during regional lockdowns in the second half of 2020. In Germany, for example, 6.1% of all sales were made through the service.

Volvo bosses said they were confindent they could maintain that growth in 2021, with the firm reporting that sales in January were up 30.2% on the same period last year. That growth was largely driven by China, which was under a lockdown in January 2020, although sales in Europe increased by 9% and in the US by 32.4% year on year.