Volvo has abandoned to plans to make only electric-powered vehicles by 2030, with 10% ‘mild hybrids’ or petrol-powered cars now part of its schedule.
The Swedish icon, which is owned by Chinese group Geely, had planned to go fully electric by 2030 but that target has been watered down to 'between' 90-100% including hybrids.
Jim Rowan, chief executive, said: “We are resolute in our belief that our future is electric.
“However, it is clear that the transition to electrification will not be linear, and customers and markets are moving at different speeds of adoption.”
Sales of electric vehicles have tanked in the past year all across Europe as drivers have struggled with the cost, finding charge points and insurance.
Volvo conceded that market conditions had changed with another price hike on the way when hefty EU tariffs are applied to Chinese-made vehicles.
European car makers have all been redrawing pans for electric vehicles following the recent sales slowdown and Volvo's move comes in the wake of a growing crisis at Volkswagen.
The German car giant said today that the imposition of tariffs on Chinese-made cars might wipe out its Cupra Tavascan model, which is out together in Spain but with significant China input.
VW is already facing widespread industrial action in Germany after announcing it might close a domestic factory for the first time in 57 years.
The carmaker has seen sales plunge in Germany and China, its most profitable market with EVs bearing the brunt of the decline.