Swedish automotive major Volvo (OTC:VLVLY) (GB:0HTP) (DE:VOL1) is introducing a passport for EV batteries. This global first from the company comes ahead of key regulations in Europe that are slated to go into force in 2027.
A Global First
The EV battery passport is being launched by Volvo Cars for its flagship EX90 SUV. The vehicle’s deliveries are expected to begin from H2 2024, as reported by Reuters. The EV battery passport will record the origin details for raw materials and components in batteries as well as their carbon footprint.
Volvo’s move comes ahead of new regulations in the European Union that mandate battery passports for EVs sold in the region from February 2027. Importantly, Volvo plans to make all its vehicle offerings fully electric by the end of this decade. Further, the company aims to gradually introduce passports for all of its EVs over the coming periods.
This innovative passport took five years to develop. Volvo collaborated with Circulor, a company specializing in supply chain mapping, to bring it to fruition. Impressively, Circulor’s solution tracks battery components from mines to vehicles. Curiously, a similar development could play out in the U.S. as well. While the U.S. currently lacks similar EV battery tracking regulations as Europe, American automakers may require a comparable solution, like Volvo’s, to qualify for EV subsidies under the Inflation Reduction Act.
Is Volvo Stock a Buy, Sell, or a Hold?
Volvo’s share price has rallied by over 44% over the past year despite a challenging macroeconomic environment. Overall, the Street has a Moderate Buy consensus rating on the stock, alongside an average Volvo price target of KR 324.10.
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