Speaking to German daily Frankfurter Allgemeine Zeitung earlier this week, Volvo CEO Håkan Samuelsson said escalating costs and ever tightening emissions regulations associated with diesel engines, could see it phasing out oil burners completely, despite continuing to develop its current range of units first introduced in 2013.
"From today's perspective, we will not develop any more new-generation diesel engines. We have to recognise that Tesla has managed to offer such a car for which people are lining up. In this area, there should also be space for us, with high quality and attractive design," Samuelsson said of electric cars.
While still accounting for a large percentage of sales in Europe, with 90% of all XC90's sold in the United Kingdom reported to be diesel powered, Samuelsson stated that emissions requirements, which will require manufactures to drop their fleet's CO2 levels from 130 g/km to 95 g/km in 2021, could see hybrids and electric cars becoming more viable than diesel vehicles.
The manufacturer is expected to unveil its first all-electric model in 2019.