The CEO of Volvo Vehicles has informed CNBC that the automaker’s shift to electrical autos is the explanation behind its deliberate itemizing on the Nasdaq Stockholm inventory change.

The corporate needs to lift 25 billion Swedish krona, or $2.9 billion, through the preliminary public providing, which will likely be one of many largest in Europe this yr.

In an interview with CNBC’s Julianna Tatelbaum Monday, Hakan Samuelsson was requested why the corporate was going public now.

“We now have a really massive curiosity from traders to take a position into EV corporations, you see that rising on a regular basis,” he stated. “We now have stated 2030 is our finish date for [the] ICE [Internal combustion engine] engine and we after all wish to safe that transformation.”

Samuelsson defined that the shift to electrical autos was “not freed from cost.”

“That is why we are actually speaking about [the] main issuing of latest shares in round 3 billion U.S. {dollars} … And that’s actually to have the monetary sources to safe this transformation within the subsequent 5, six years. That is actually … the explanation for our ‘intention to drift’ message,” he added.

In March, Volvo Vehicles — which is headquartered in Sweden however owned by China’s Zhejiang Geely Holding Group — stated it deliberate to turn into a “totally electrical automotive firm” by the yr 2030.

“There isn’t any long-term future for vehicles with an inner combustion engine,” Henrik Inexperienced, Volvo Vehicles’ chief expertise officer, stated on the time. “We’re firmly dedicated to turning into an electric-only automotive maker and the transition ought to occur by 2030.”

Volvo Vehicles is considered one of a lot of automakers trying to make the transition to totally electrical autos. In July, Germany’s Daimler stated its Mercedes-Benz model would “be able to go all electrical on the finish of the last decade, the place market situations enable.”

In February, Ford stated its whole passenger car vary in Europe can be “zero-emissions succesful, all-electric or plug-in hybrid” by the center of 2026, with a “utterly all-electric” providing by 2030.

This transition comes as main economies additionally lay out plans to maneuver away from the interior combustion engine.

The U.Ok., for instance, needs to develop a net-zero transport sector by 2050, stopping the sale of latest diesel and petrol vehicles and vans by 2030. It would require, from 2035, all new vehicles and vans to have zero tailpipe emissions.

Elsewhere, the European Fee, the EU’s government arm, is concentrating on a 100% discount in CO2 emissions from vehicles and vans by 2035.

Chip challenges

All of the above adjustments are happening whereas international automotive producers proceed to battle the influence of a worldwide semiconductor scarcity.

On Tuesday, figures launched by the Society of Motor Producers and Merchants confirmed that 215,312 vehicles had been registered within the U.Ok. throughout September 2021. This represents a decline of 34.4% in comparison with the identical month in 2020, with the SMMT describing it because the “weakest September since 1998.”

In a press release, the business physique stated the “ongoing scarcity of semiconductors” had impacted car availability. 

The SMMT additionally famous, nonetheless, that “September was one of the best month ever for brand new battery electrical car (BEV) uptake.”

“With a market share of 15.2%, 32,721 BEVs joined the street within the month, reflecting the wide selection of fashions now accessible and rising shopper urge for food,” the SMMT stated.  The most effective-selling automotive for the U.Ok. market in September 2021 was the Tesla Mannequin 3.