Swedish automobile manufacturer Volvo Cars, owned by China’s Geely, said on Wednesday it had signed long-term agreements with CATL and LG Chem to supply lithium ion batteries for electric vehicles.
The deals with the Chinese and South Korean groups, two of the leading firms in the industry, “represent a major step towards realising Volvo Cars’ ambitious electrification strategy,” Volvo Cars said in a statement.
Volvo Cars has pledged to offer only hybrid and electric versions on new models from 2019 and aims to have them account for half of its sales by 2025.
The company sold over 642 000 vehicles last year.
“The future of Volvo Cars is electric and we are firmly committed to moving beyond the internal combustion engine,” said chief executive Hakan Samuelsson in the statement.
“Today’s agreements with CATL and LG Chem demonstrate how we will reach our ambitious electrification targets.”
Volvo Cars said it expects its first battery assembly line, under construction in Belgium, to be completed by the end of the year and the first fully-electric Volvo would be its XC40 small SUV.