Volvo’s CEO tells us that EVs are getting cheaper and are worth more used – and that Gen Z is key to selling them

HE looks like a genius from the Apple Store with this headset. But he’s not.

He’s the gaffer at Volvo Cars, having previously worked at Dyson and BlackBerry, and he’s Scottish.

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Jim Rowan, Volvo CEO and President, believes the auto industry will change beyond recognition in the next decade – and he’s not just talking about electricity, sustainable materials and self-driving technology to “protect people and the planet”.

He talks about how we use cars and how we pay for them.

Here are ten minutes in the mind of one of the most powerful men in the auto world.

Jim said: “It’s ridiculous to me to think that this is an industry where you sell a car for £40,000 or £50,000 to someone you never speak to. You leave all this to your dealer network.

“In today’s world of Gen Z digital natives, that’s not going to work. You don’t target this young demographic at retailers, you target this young demographic in search and on social media.

“If you have a small SUV (like the forthcoming EX30) at comparatively low prices and with subscription ownership that we’re now offering for three months, they don’t even go to the dealer. You will buy online.

“I guarantee you. I know that. This is my line of business. Then you have a direct relationship with these customers from a very early age.

“Do our job right and we will keep these customers and trade them in. If they get married, have a dog, have children and want a second car. Then they say: “I love a Volvo”.

“Talk to them regularly and then you can say, ‘What else do you want from us? Do you want insurance? Would you like to have your tires converted from winter tires to summer tires?’

“That’s where you get sticky and develop a really strong relationship with customers.

“When you decide to switch your car, it’s like when you decide to switch your iPhone, it’s a hassle because you get so many benefits and you think, ‘I’ll just stay on the platform.’

“I think that’s the path the industry is going to take.”

“Technology Wins the Day”

Jim spoke at the launch of Volvo’s flagship EX90, a seven-seat electric SUV crammed with cutting-edge software, safety technology and bio-based materials.

It’s not cheap at £85,000. But Jim is adamant that costs will come down and that other “frictions” to EV adoption — such as range, charging speeds, and charging infrastructure — are “beginning to be resolved.”

He said: “The costs will absolutely go down. Lithium is high right now, but it will go down. Not only that, next-generation battery chemistries and manufacturing will drive those costs down as well.

“You’re going to see different chemistries and more people coming up with competition. That will lower the cost. charging infrastructure? Everyone leans on that. Even the big private equity guys. sleeve. bp These guys are looking for new sources of income.

Maybe some people don’t care about sustainability, but I guarantee you, Gen Z does.

Volvo CEO and President Jim Rowan

“Then you go from a 400-volt to an 800-volt charging system and you can charge 180 miles in less than ten minutes.

“Maybe some people don’t care about sustainability, but I guarantee you, Gen Z does. And they’ll say, “I’m going to put up with some of those friction factors because I don’t want to destroy the planet the way we’ve been doing internal combustion engines (ICEs) for so long.”

“And if you look at ICE versus electric propulsion, an ICE motor runs 32-35 per efficiency at best. Our new motors here are 93 percent electric.

“Technology wins the day. That’s why we all walk around with iPhones and no one is tied to a phone anymore. Were they more expensive when they first came out? Absolutely. But did they offer so many other benefits? Absolutely.

“So if you’re looking at bi-directional charging and next-generation computing, the benefits you’ll have in your vehicle are tremendous.

“I’m going camping, right. With my electric car I can heat or cool a tent for three days. I can charge a small fridge. I can charge my cell phone. I can charge my e-bike.

“It’s a whole lifestyle change that you don’t have with an internal combustion engine. And you have the added benefit of trying to give the planet a little rest.”

There’s no denying that a battery-powered XC40 costs £10,000 more than a petrol XC40 today.

But Jim has an answer for that too. He said: “When people make big buying decisions in the future, they’re going to really think about the residual value of an internal combustion engine in three or four years and whether I should buy an electric vehicle because it’s going to have a higher residual.

“Because the ICE technology will fail. Plug-in hybrids will provide a bridge to move people towards full electric vehicle adoption and we need to ensure we are positioned in all of these markets.”

He’s no Apple Store genius, but he’s still on.