FULLTEXT DEL 1 AV 6
Årsredovisning 2025
===== SIDA 1 =====
Freedom to
move.
Volvo Car Group
Annual and Sustainability Report 2025
===== SIDA 2 =====
OUR PURPOSE / WHY WE ARE HERE
Personal
With our deep understanding of human behavior
we develop products that understand, support
and protect people in and around the car. Never
forcing anyone to compromise on the way they
want to live life.
Sustainable
We always aim for the highest standards of
sustainability in mobility. This approach does
not mean compromise – it means creating
smarter, more efficient products that people can
be proud to choose.
Safe
In 1927, our founders stated that safety is the
guiding principle behind everything we do.
We stay committed to leadership in safety and
a higher quality of life for people.
To provide freedom
to move in a personal,
sustainable and
safe way.
VOLVO CAR GROUP / OVERVIEW / PURPOSE2
===== SIDA 3 =====
OVERVIEW
2 Purpose
4 About Volvo Cars
7 2025 highlights
13 CEO letter
15 MARKET
16 Global automotive market
17 Market defining trends
18 OUR STRATEGIC FRAMEWORK
20 Our guiding principles
21 Our strategic direction
22 Customer experience
24 Committed organisation
26 Electrification and regionalisation
29 DIRECTORS' REPORT
36 RISK
37 Enterprise Risk Management
42 CORPORATE GOVERNANCE
43 Corporate Governance Report
51 Board of Directors
56 Executive Management Team
59 Extended Executive Management Team
60 Auditor’s Report
61 FINANCIALS
63 Consolidated Financial Statements
70 Notes to the Consolidated Financial Statements
115 Alternative Performance Measures
119 Parent Company Financial Statements
121 Notes to the Parent Company Financial Statements
126 Proposed distribution of non-restricted equity
127 Auditor’s Report
130 SUSTAINABILITY
132 General information
148 Environmental information
179 Social information
199 Governance information
206 Other information
214 Auditor’s Report
220 The share
222 Our heritage
226 Definitions
222
OUR HERITAGE
61
FINANCIALS
130
SUSTAINABILITY
18
OUR STRATEGIC FRAMEWORK
13
CEO LETTER
7
HIGHLIGHTS
Volvo Car Group’s formal Annual Report
is presented on pages 29–35, 61–114, 119–126
and 130–213. Page 29–35, 61–114 and 119–126
has been audited, while the Sustainability
Statement, which constitutes part of the
Directors’ Report, included on page 130–213,
has been subject to limited assurance, by the
Group’s auditors.
===== SIDA 4 =====
Born in Sweden and now nearly 100 years old, we remain
deeply rooted in our Swedish heritage. Through our history,
Volvo Cars became synonymous with safety. And where safety
once meant inventing the three-point seatbelt and sharing it
globally, having helped save a million lives, our scope now also
encompasses working to improve sustainability in mobility.
Setting new standards
Our ambition is to set new standards, whether through cus -
tomer experience, electrification, manufacturing processes or
carbon emissions reductions. Inspired by Swedish design and
craftsmanship, we aim to create elegant, intuitive yet advanced
products that address real-world needs - from how a car is
purchased or leased to how it feels to drive and ride in and how
it interacts with its surroundings.
Electrification is key
We are ready to go fully electric when our customers are. In a
challenging market environment, we are taking decisive action
to enhance resilience and position us for profitable growth. Our
direction is clear: we will become a fully electric car company.
Electrification is a key driver of future volume and profitability,
and we are committed to leading this transition.
We offer a strong line-up of fully electric cars. For those cus -
tomers or markets not quite ready to make the shift we offer
upgraded hybrid models as a bridge to an all electric future.
Our customers set the pace. We are ready when they are.
Perform and transform
We are now accelerating efficiency and performance through
targeted initiatives in organisation, leadership, product devel -
opment, and manufacturing, complemented by a sharper focus
on regionalisation and commercial execution. With the peak of
our investment phase behind us, we are now aiming to increase
margins and strengthening cash flow. By maintaining disci -
plined cost control and driving operational excellence, we are
executing our strategic roadmap and reinforcing a solid finan -
cial foundation.
Our strong focus on both performance and continued trans -
formation ensures we remain competitive and resilient today,
while positioning Volvo Cars for long-term growth and leader-
ship in the future of mobility.
A brand for people
who care
OUR BRAND / WHO WE ARE
From the outset, Volvo Cars has been a brand for people
who care about the world we live in and the people around us.
We have made it our mission to make life easier, better and
safer for everyone.
We are driven by finding new ways to provide
freedom to move in a personal, sustainable
and safe way.
Our brand is uniquely shaped by Sweden,
combining Scandinavian design, with human
centricity and durability in everything we do.
We are committed to leadership in safety and
a higher quality of life for people. For Life.
Freedom to Move
By Sweden
For Life
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
4 VOLVO CAR GROUP / OVERVIEW / ABOUT VOLVO CARS
===== SIDA 5 =====
~ 710,000
RETAIL SALES
24%
PLUG IN HYBRID
~ 2,200
RETAIL LOCATIONS
~ 42,600
EMPLOYEES
21%
FULLY ELECTRIC
+ 100
COUNTRIES SHARE OF RETAIL SALES
China 21%
US 17%
Other 15%
Europe 47%
China 21%
US 17%
Other 15%
Europe 47%
We started in Sweden almost a century
ago and have since built a strong footprint
across Europe, Asia and the United
States. Today, our cars are sold in more
than 100 countries. As globalisation
recedes, we are now adapting to a more
regionalised landscape, tailoring our
products, technologies, manufacturing,
and commercial strategies to meet the
specific needs of our customers in each
region. Our over arching strategy is simple:
to build where we sell. This model
enhances our ability to respond to market
dynamics and strengthens our resilience.
A global brand
– adapting to a
more regionalised
landscape
READ MORE ABOUT REGIONALISATION
ON PAGE 26
~ 2,800
AMERICAS EMPLOYEES
~ 31,000
EUROPE EMPLOYEES
~ 8,800
ASIA EMPLOYEES
BELGIUM
GHENT
CAR PRODUCTION
JAPAN
TOKYO
APEC HQ
SWEDEN
GOTHENBURG
GLOBAL HQ
R&D
DESIGN CENTRE
CAR PRODUCTION
STOCKHOLM
TECH HUBUSA
MAHWAH, NJ
US/CANADA HQ
CHARLESTON, SC
CAR PRODUCTION
BRAZIL
SÃO PAULO
LATAM
LUND
TECH HUB
OLOFSTRÖM
BODY COMPONENTS
SKÖVDE
E-MOTORS
FLOBY
BODY COMPONENTS
POLAND
KRAKOW
TECH HUB
SLOVAKIA
KOŠICE
CAR PRODUCTION
MALAYSIA
KUALA LUMPUR
TECH HUB AND
ASSEMBLY FACTORY
SINGAPORE
TECH HUB
INDIA
BANGALORE
TECH HUB
AND CONTRACT
ASSEMBLY
CHINA
SHANGHAI
GREATER CHINA HQ
REGIONAL R&D AND
DESIGN CENTRE
CHENGDU
CAR PRODUCTION
DAQING
CAR PRODUCTION
TAIZHOU
CAR PRODUCTION
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
5 VOLVO CAR GROUP / OVERVIEW / ABOUT VOLVO CARS
===== SIDA 6 =====
Volvo Cars offers a balanced portfolio of fully
electric and hybrid cars, providing the strategic
flexibility to leverage our strengths across
diverse regional markets.
Most recently, in January 2026 we launched
the EX60 – the first car built on our new SPA3
platform. The new mid size electric SUV, EX60,
is expected to be our next volume driver, com-
pleting our offering in this important segment.
During 2025, the fully electric ES90 and the
XC70 long range PHEV were premiered.
In the years to come, we will continue bringing
new electric models to the market while also
refreshing our plug-in hybrid cars for customers
and markets that are not yet ready to fully
transition.
A balanced portfolio
of fully electric and
hybrid cars
READ MORE ON PAGE 26
Current hybrid and long-range plug-in hybrid models
Current fully electric models
EX30
XC40
EC40
S60
EX40 EX60
V60
ES90
XC60
EX90
XC70 S90
EM90
XC90
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
6 VOLVO CAR GROUP / OVERVIEW / ABOUT VOLVO CARS
===== SIDA 7 =====
Highlights
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
7 VOLVO CAR GROUP
===== SIDA 8 =====
Operational highlights
EX30 IN PRODUCTION NOW
IN EUROPE
In April, Volvo Cars started production
of the fully electric EX30 small SUV at
the manufacturing plant in Ghent,
Belgium. Volvo Cars thereby continues
to further diversify the global manufac -
turing footprint for one of its most
popular models, and expand production
capacity to better meet local demand.
LAUNCH OF COST AND CASH
ACTION PLAN
In April, Volvo Cars launched a cost
and cash action plan totalling SEK 18 bn,
including a global redundancy
programme.
46%
SHARE OF ELECTRIFIED CARS
In 2025, Volvo Cars sold 323.3 thousand
electrified cars, accounting for 46 per
cent share of the total sales, whereas
BEVs accounted for 21 per cent share of
total sales. Volvo Cars continues on its
path towards being a leading fully electric
company, with plug-in hybrids as a prag-
matic bridge to get there.
CONTINUED INVESTMENTS
IN THE US
During the year, Volvo Cars announced
the addition of the best-selling XC60
mid-size SUV to the production line of
the US plant in Ridgeville, just outside
Charleston in South Carolina. Further-
more it was announced that before
2030, Volvo Cars plans to add a new,
next-generation hybrid model to the
Charleston plant. The coming new
model is designed to meet the specific
demands of the US market, in line with
Volvo Cars increased focus on ensuring
each region has the best product port-
folio to meet customer demands.
THE ALL-NEW, FULLY ELECTRIC
VOLVO ES90 IN PRODUCTION
THE NEW VOLVO XC70
LAUNCHED
In September, Volvo Cars started produc-
tion of the new, fully electric Volvo ES90.
Built on the SPA2 architecture, the ES90
is designed to continuously evolve and
improve through core computing tech-
nology, constant connectivity and data.
It was the first Volvo car to feature 800
volt battery technology, enabling longer
range and faster charging. It is the sixth
fully electric model in the line-up, joining
the EX90, EM90, EX40, EC40 and EX30
as the journey towards full electrification
continues.
In August, the new Volvo XC70 SUV was
revealed. The XC70 is Volvo Cars’ first
long-range plug-in hybrid, offering an
all-electric driving range of over 200km
under the CLTC testing cycle. Built in
collaboration with Geely, on the new
Scalable Modular Architecture (SMA)
platform for long-range plug-in hybrids,
the new XC70 represents an important
addition to Volvo Cars’ product lineup.
It is designed to meet growing demand
for longer-range plug-in hybrids, par-
ticularly in China. Production and first
deliveries were started in Q3.
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
8 VOLVO CAR GROUP / OVERVIEW / 2025 HIGHLIGHTS
===== SIDA 9 =====
“ Electrification is an
opportunity for us and the
main driver for growth.
Besides that, the key building
blocks for profitable growth
are variable cost reductions
supported by hardware
synergies with Geely, further
indirect cost reductions
and structurally lower
investments.”
Håkan Samuelsson ,
President and CEO for Volvo Cars
Our turnaround programme structured around Electrification,
Regionalisation and Profitability, underpins our strategic direction.
Electrification
We continue our path towards being
a leading fully electric company,
with plug-in hybrids as a pragmatic
bridge to get there.
Regionalisation
We are developing a more regional
organisation with more empowered
regions to faster adapt to a more
regionalised world.
Profitability
We continue to safeguard our
profitability and improve our cost
position.
Turnaround programme
In a market undergoing rapid and profound transformation,
we maintain a strong position supported by a trusted brand,
a competitive portfolio of BEVs and PHEVs, and a solid financial
foundation reinforced by recent cost and cash optimisation
measures. Our new SPA3 platform provides access to one of
the industry’s most advanced, uncompromised BEV architec -
tures, while our collaboration with Geely secures a unique
footprint in China and synergies beyond.
With the heavy investment phase behind us, we are now
structurally building a company geared toward a long-term
EBIT margin above 8 per cent and strong positive cash flows
through profitable electrified growth, increased synergies with
Geely as well as indirect cost reductions.
We are accelerating efficiency and performance through
targeted initiatives in organisation, leadership, product
development, and manufacturing, supported by a regionalised
approach and commercial strategy with competitive and
adapted offerings for each region.
Our commitment to both performance and ongoing trans -
formation ensures we remain competitive and resilient today,
while positioning Volvo Cars for long-term growth and leader-
ship in the future of mobility.
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
9 VOLVO CAR GROUP / OVERVIEW / 2025 HIGHLIGHTS
===== SIDA 10 =====
On 21 January 2026, Volvo Cars introduced the
Volvo EX60, a new all-electric mid-size SUV, the
first car built on the new SPA3 electric architecture.
The EX60 changes the game in th e largest electric
market segment in terms of range, charging speed,
performance and price. The five-seater, family -
friendly EX60 ends range anxiety, delivers a
groundbreaking user experience and represents
the next frontier in safety. It is also Volvo Cars’ first
entry in the largest electric segment globally,
allowing it to substantially increase Volvo Cars’
addressable market and electric market share.
Launch of the
EX60
EVENTS AFTER YEAR-END OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
10 VOLVO CAR GROUP / OVERVIEW / 2025 HIGHLIGHTS
===== SIDA 11 =====
Financial highlights
• Retail sales decreased by –7 per cent to
710.0 (763.4) thousand cars.
• Revenue amounted to SEK 357.3 (400.2)
bn, primarily explained by lower whole-
sale volumes and unfavourable sales mix
and pricing, partially offset by increased
used car sales.
• Operating income (EBIT) was SEK 0.3
(22.3) bn, mainly impacted by items
affecting comparability, a one-time
non-cash impairment charge of SEK 11.4
bn and restructuring cost of SEK 0.8 bn.
Excluding these, the decrease was
mainly explained by sales mix and pric-
ing as well as lower wholesale volumes
and increased cost for tariffs and nega -
tive foreign exchange impacts from a
strengthened SEK.
• EBIT margin was 0.1 (5.6) per cent.
• Basic earnings per share was SEK 0.06
(5.17).
• Operating and investing cash flow was
SEK 2.4 (1.1) bn, primarily driven by lower
investments, increased year-end pro-
duction and proceeds from the divest-
ment of shares in Lynk & Co.
• The Board of Directors proposes that
no dividend should be paid out.
FORWARD LOOKING
• For 2026, Volvo Cars aims to come back
to volume growth on a year-on-year
basis for the full year and increase cash
generation with full year free cash flow
clearly better than what was achieved
in 2025.
EBIT AND EBIT MARGIN
(SEK BN/%)
KEY FIGURES FINANCIALS (SEK m)
REVENUE AND GROSS
MARGIN (SEK BN/%)
RETURN ON INVESTED
CAPITAL, ROIC (%)
2025 2024 2023
Retail sales, units 710,042 763,389 708,716
Revenue 357,263 400,234 399,343
Research and development expenses –26,067 –16,983 –12,884
Operating income (EBIT) 303 22,318 19,939
Operating income (EBIT) excl. share o f income from JVs &
associates –351 27,040 25,567
Operating income (EBIT), excl. Items affecting comparability 12,556 24,020 20,563
Net income –2,968 15,934 14,066
Basic earnings per share, SEK 0.06 5.17 4.38
EBITDA 35,679 45,048 37,388
Cash flow from operating activities 34,625 47,372 42,867
Cash flow from investing activities –32,176 –46,245 –51,842
Net cash 26,871 27,115 27,487
Gross margin, % 16.9 19.8 19.4
EBIT margin, % 0.1 5.6 5.0
EBIT margin excl. share of income fro m JVs & associates, % –0.1 6.8 6.4
EBITDA margin, % 10.0 11.3 9.4
Return on invested capital, ROIC, % 0.2 12.0 12.4
5
10
15
25
20
–1
3
2
1
00
4
5
8
6
7
21 2422 23 25
EBIT, SEK bn
EBIT-margin, %
EBIT-margin excl. share of
income in JV & associates,%
SEK bn %
21 2422 23
0
150
100
50
200
250
400
300
350
0
5
10
15
25
20
25
Revenue, SEK bn
Gross margin, %
SEK bn %
0
5
10
15
25
20
21 2422 23 25
Invested capital is calculated
on two-year average figures.
%
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
11 VOLVO CAR GROUP / OVERVIEW / 2025 HIGHLIGHTS
===== SIDA 12 =====
Sustainability highlights
2025 2024 2023
Climate Action
Reduction of CO 2 emissions per car, %1)2) 31 32 27
Electrified cars retail sales (BEVs and PHEVs), % 46 46 38
Climate neutral energy in own operations, % 87 78 74
Circular Economy
Water withdrawal reduction per manufactured car in own
operation, %1) 29 20 25
Recirculation rate, % 95 94 87
Additional circular business revenue and cost savings, SEKm 1) 149 266 508
Responsible Business
The share of green debt, in accordance with our Green
Financing Framework, or sustainability-linked format as
percentage of outstanding debt, % 98 76 52
Women in senior leadership, %2) 29.1 29.7 —
Injury rate (LTCR) employees 0.06 0.05 0.06
1) Compared to the baseline 2018.
2) Historical figures have been updated. More information can be found on page 207.
For further definitions and reporting principles, see Sustainability Statement, starting on page 130.
88
SAFEGUARD HUMAN RIGHTS
High-risk sites in value chain assessed
on responsible business conducts,
including supplier audits and People
Policy Assessments.
27%
31%
INCREASE RECYCLED MATERIAL
IN OUR CARS
CO2 EMISSIONS REDUCTION PER CAR
With 27 per cent recycled material in
the EX60, the 2025 ambition of 25 per
cent recycled and bio-based material
in new car models was achieved.
We achieved a 31 per cent reduction in
CO2 emissions per car, reaching our 2025
ambition and strengthening our momen-
tum toward our ambition for net zero.
29%
WATER WITHDRAWAL REDUCTION
PER MANUFACTURED CAR
Water efficiency measures resulted
in a decrease of water withdrawal in
absolute terms and in relation to
manufactured cars.
KEY FIGURES SUSTAINABILITY
• We met our 2025 CO2 ambition with 31 per cent
CO2 emission reduction per car, compared to
the baseline 2018. Electrified car sales reached
46 per cent, contributing to reducing tailpipe
CO2 emissions by 42 per cent.
• Climate neutral energy in own operations
reached 87 per cent. In 2025, four of our facto -
ries have transitioned to climate neutral energy
meaning seven out of nine production sites are
fully climate neutral.
• Two new electrified cars were launched, the
ES90 and XC70, extending our portfolio and
meeting the customer demands.
• Progress on circular business through a
contract for closed loop steel that helps
mitigate cost for recycled materials.
• Industry-leading workplace safety achieved
with an injury rate (LTCR) of 0.06.
• Processes within our human rights due dili -
gence were enhanced, including conducting
88 (96) audits and People Policy Assessments
in high-risk sites in our value chain as well as
addressing 85 per cent of corrective action
plans from previous RBA VAP audits.
• The share of green debt, in accordance with
our Green Financing Framework, or sustaina -
bility-linked format increased to 98 per cent
of outstanding debt. The issuance of our fifth
green bond contributed to closing in on our
100 per cent ambition 2025.
SUBSEQUENT EVENTS
• The new EX60 was launched in January 2026.
With 27 per cent recycled content, it overa -
chieves our 2025 ambition of 25 per cent in
new car models and sets new standards with
the lowest CO 2 footprint in our fleet to date.
• The new multi-adaptive safety belt was
launched in the new EX60 demonstrating a
continued focus on innovative technology to
improve safety in our cars.
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
12 VOLVO CAR GROUP / OVERVIEW / 2025 HIGHLIGHTS
===== SIDA 13 =====
In April last year I returned to Volvo Cars. It has been an exciting
yet demanding year since then. The automotive industry has
seldom been faced with so many new challenges at the same
time. Slowing growth, regionalisation of the world, a transition
towards electrification and software-defined cars, as well as
intensifying competition from new Chinese car makers.
With all this uncertainty, it can be easy to lose perspective.
For us however, the future of our company is clear.
Some years ago, we made the bold decision that the future of
Volvo Cars must be electric. Today, we’re even more convinced
that this is the right choice. Not only to address the climate
challenge, but also to meet customers’ expectations for better
and more attractive cars.
This is where our recently revealed EX60 model comes in.
Just like the XC90 marked the beginning of a new era in 2014,
the EX60 signals the next chapter for Volvo Cars as leader in
the all-electric premium segment.
We know that some people still hesitate to go all-electric
for three main reasons: concerns about range, charging time
and price.
With the EX60, we directly address these concerns. It has
class-leading range similar to many petrol cars. Charging stops
take just as long as a normal fuel and coffee stop.
Focused on a clear strategic
roadmap as well as
short-term performance
And most importantly, the EX60 will be priced in line with our
best-selling XC60 plug-in hybrid. On top of that, it will be offered
in a new commercial concept, designed around simplicity, trans-
parency and precision.
Well-positioned to grow
Equally important is that the EX60, with its game-changing
new technologies, shows how we can meet the expectations
of our customers while growing volume and profitability.
We are structurally building a company towards a long-term
EBIT margin of over 8 per cent, strong positive cash flows and
growth driven by electrification.
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
We are structurally building a
company towards a long-term EBIT
margin of over 8 per cent, strong
positive cash flows and growth
driven by electrification.
13 VOLVO CAR GROUP / OVERVIEW / CEO LETTER
===== SIDA 14 =====
With a strong electric product portfolio, built on the new
cost-efficient and scalable SPA3 architecture, Volvo Cars is
well-positioned to make this happen.
I believe that we are also in a better position than our peers
to tackle the growing competition from Chinese automakers,
both within China and in Europe. Our unique relationship with
Geely gives us the opportunity to work even closer to lower
development costs and to bring new cars to the market quicker.
Together we are creating a leaner, more resilient supply chain.
The XC70 long-range plug-in hybrid shows how this works in
practice and can deliver quick results.
The successful execution of our cost and cash action plan
during 2025 is a good foundation for further profitable growth.
In 2026 we will continue to focus on lowering variable and indi -
rect costs, in combination with actions to increase sales.
An encouraging sustainability development
Summarising 2025 should also include our sustainability
progress. The commitment to becoming an electric car maker
underpins our sustainability ambitions for 2030 and beyond
and we are ahead of our competitors on most sustainability
metrics.
I’m particularly proud to see that we achieved our goal of
reducing our CO2 footprint with a 31 per cent reduction per car
compared with the 2018 baseline.
We also made significant progress in usage of climate neutral
energy in our operations and we achieved climate neutral
status at seven of our nine manufacturing plants.
In terms of our products’ footprint, the new EX60 leads by
example. It has the lowest carbon footprint of any electric
Volvo car, matching that of the much smaller EX30. The EX60
also comes with the highest amount of recycled materials in
any electric Volvo. In addition, the introduction of mega casting
and cell-to-body on the SPA3 platform further reduces manu -
facturing waste and material use.
The right strategy
We are navigating one of the most challenging periods that
I have seen the industry go through.
However, I am confident that Volvo Cars has the right strat-
egy to ride the storm and emerge as a stronger, more profitable
company.
We will continue a resolute execution of our longer-term
strategy and at the same time focus on shorter-term improve -
ments of both cost and sales performance.
Håkan Samuelsson
CEO, Volvo Cars
SHARE OF
ELECTRIFIED SALES
46%
FREE CASH FLOW
SEK BN
We will continue a
resolute execution of our
longer-term strategy and at
the same time focus on
shorter-term improvements
of both cost and sales
performance.
0
2221 23 24 25
SEK bn
–9,0
3,0
OVERVIEW
PURPOSE
ABOUT VOLVO CARS
2025 HIGHLIGHTS
CEO LETTER
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
14 VOLVO CAR GROUP / OVERVIEW / CEO LETTER
===== SIDA 15 =====
Market
OVERVIEW 3
MARKET
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
15 VOLVO CAR GROUP
===== SIDA 16 =====
Sales and market development
Throughout the full year 2025, the global passenger car market
operated under challenging and uneven conditions, influenced by a
combination of macroeconomic pressures, geopolitical tensions, as well
as regulatory and trade-related developments. The industry’s transition
towards electrification progressed at a moderated pace during 2025.
Overall, the year was characterised by restrained demand and intensified
competition. The profitability of the industry has been under pressure
especially in the light of tariffs and writedowns by several OEMs, leading
to a heightened focus on profitability as well as efficiency.
Volvo Cars’ full-year retail deliveries reached 710.0 (763.4) thousand
cars. Wholesales decreased by 11%, and production decreased by 9% to
694.2 (760.4) thousand cars. Despite the headwinds during 2025, Volvo
Cars remained committed to navigating uncertainty while positioning
the business for sustainable growth. The focus remains on efficiency,
cost control and strengthening the core business, providing a solid foun -
dation for when market conditions stabilise. Sales of BEVs decreased by
13% to 151.8 (175.2) thousand cars, and PHEV sales decreased by 3%
compared to 2024.
Europe
The overall European passenger car market increased by 2% compared
to 2024, while the premium car market declined by 4%. The electrified
segment continues to show momentum, with both BEV and PHEV sales
increasing by 27% and 35% respectively.
China
The total Chinese passenger car market increased by 2% year-on-year,
of which the BEV segment increased by 28% and the PHEV segment
increased by 5%. The premium segment decreased by 15% compared to
2024. Consumer demand continues to shift from combustion-engine
models to electrified cars, where competition is intense and domestic
brands are dominating.
US
The total US passenger car market increased by 3% compared to 2024,
and the premium market increased by 1%. BEV sales increased by 6%
while PHEV sales decreased with 9%. The US automotive market contin -
ued to be affected by evolving policy conditions, trade dynamics and
broader economic uncertainty.
Volvo Cars’ market share per
propulsion type, % 1) 2)
Full year
2025
Full year
2024
BEV 1.16 1.46
PHEV 3.07 3.80
ICE (incl. mild hybrids) 0.75 0.72
Volvo Cars’ share of total market 1.00 1.04
Total industry volume share and growth by
propulsion type, % 1) 2)
Full year
2025
Full year
2024
BEV 19 16
EREV 2 —
PHEV 8 7
ICE (incl. mild hybrids) 72 77
Total 100 100
1) Volvo Cars is and will continue to be positioned in the premium segment of the
automotive market. As the market is transforming with electrification and
digitalisation the definition of premium is being redefined. To simplify and to avoid
the risk of excluding important parts of the market, market share is reported in
relation to the global passenger market.
2) Includes content supplied by S&P Global Mobility Industry Performance, February
2026, capturing more than 85 per cent of total world sales. All rights reserved.
Retail sales (k units) 2025 2024 2023
Europe 332.7 369.7 294.8
China 149.5 156.4 170.1
US 121.6 125.2 128.7
Other 106.2 112.1 115.1
Retail sales total 710.0 763.4 708.7
Electrified cars 323.3 352.8 266.0
whereof BEVs 151.8 175.2 113.4
Electrified cars share 46% 46% 38%
whereof BEV share 21% 23% 16%
Wholesales 693.0 782.6 732.3
Production volume 694.2 760.4 766.7
Global automotive market
OVERVIEW 3
MARKET
GLOBAL AUTOMOTIVE MARKET
MARKET DEFINING TRENDS
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / MARKET
16
===== SIDA 17 =====
Climate change, as a part of the triple
planetary crisis (climate change, biodi-
versity loss and pollution) is reshaping
society, driving shifts in attitudes, poli-
cies, and innovation. Transportation is a
major source of emissions, making the
transition to battery electric vehicles
critical. BEVs are the fastest-growing
segment in the passenger car market.
Despite some headwinds and some-
what softer demand than expected,
global BEV sales rose by 23 per cent in
2025.
CLIMATE CHANGE AND
ELECTRIFICATION
Volvo Cars is fully committed to reduc-
ing emissions across the entire value
chain. Electrification remains central to
our strategy for eliminating tailpipe
emissions, and we continue t o expand
our range of electric vehicles. Mean-
while, we are refreshing our plug-in
hybrid (PHEV) cars for customers and
markets that are not yet fully ready to
transition.
Market
defining
trends
The retreat of globalisation and the rise
of geopolitical polarisation are reshap-
ing the global landscape, wit h long-term
consequences that remain uncertain.
Political instability and unpredictability
are becoming the new normal, while
competition – particularly from emerg-
ing Chinese OEMs – is intensifying. In
this environment being adaptable and
agile is no longer optional, it is essential
for building resilience and driving
long-term value creation.
POLARISATION, DEGLOBALISATION
AND REGIONALISATION
As globalisation recedes, we are adapt-
ing to a more regionalised world. This
shift calls for a tailored approach
across product development, tech-
nology, manufacturing, and commercial
strategy. By empowering our regions
to respond to local customer needs and
market dynamics, we enhance our
resilience and position ourselves for
sustainable and profitable growth.
Innovation in the automotive industry is
accelerating. Advances in battery tech-
nology and charging infrastructure drive
electrification, while software-defined
vehicles transform design and user
experience. AI is optimising processes
and enables faster responses to market
demands. The convergence of comput-
ing power, connectivity, and data ana-
lytics, combined with AI, ushers in a new
technological era, redefining mobility
and making adaptability and innovation
more critical than ever.
TECHNOLOGY AND AI
We continue to test and deploy at
speed with clear intent, unlocking
benefits such as lower costs. Super-
computers and in-house software
now pave the way for next-generation
infotainment systems, over-the-air
upgrade capabilities, enhanced safety,
energy management, and other
services.
The automotive industry is undergoing
intense disruption and competition.
Electrification and software-defined
vehicles are accelerating innovation
cycles, while geopolitical tensions and
trade barriers are reshaping global
supply chains. Legacy automakers face
growing competition from agile start-
ups and rapidly expanding Chinese
brands.
HYPER COMPETITION
Volvo Cars tackles intense competition
with a focus on electrification, agility,
and regionalisation – tailoring products,
manufacturing and commercial strate-
gies to local market needs. Collabora-
tion, especially with Geely, accelerates
innovation, reduces costs, and speeds
up time-to-market. Hardware synergies
with Geely, the third largest BEV player
in the world gives Volvo Cars an unique
position, especially in China. This
approach strengthens competitiveness
and resilience amid industry disruption.
Volvo Cars’ approach
OVERVIEW 3
MARKET
GLOBAL AUTOMOTIVE MARKET
MARKET DEFINING TRENDS
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / MARKET
17
===== SIDA 18 =====
Our strategic
framework
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
1818 VOLVO CAR GROUP
===== SIDA 19 =====
OUR PURPOSE
– WHY WE ARE HERE
Our reason for existing and the
impact we strive to make.
To provide freedom to move in
a personal, sustainable and
safe way.
READ MORE ON PAGE 2
OUR BRAND
– WHO WE ARE
The identity and values
that define us.
Freedom to move.
By Sweden. For life.
READ MORE ON PAGE 4
OUR CULTURE & LEADERSHIP
– HOW WE ACT
The behaviors and leadership principles
that create the environment w e want.
How we work is just as important as
what we do.
READ MORE ON PAGE 20
OUR STRATEGIC DIRECTION
– WHERE WE WANT TO BE
Our strategy for the future and the path
to get there.
READ MORE ON PAGES 21–28
OUR ACTIONS
– WHAT WE NEED TO DELIVER NOW
The priorities and initiatives that
turn strategy into reality.
Our strategic framework is the foundation
that guides everything we do
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
19 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 20 =====
Culture
We keep it simple: We reduce complexity,
focus on what matters most and make it easier
for everyone to work better together.
We stay curious: We keep learning, ask ques-
tions, seek insights and explore new ideas to
drive speed and innovation.
We are all in: We work as one team, commit to
delivering high quality results and do not give
up even when things get difficult.
Leadership
Create clarity: We ensure our teams are focused
on the right things. We communicate clearly to
enable faster execution.
Lead with courage: We dare to take decisions
and step forward in uncertainty. We have open
conversations to achieve high performance.
Take full ownership: We act responsibly, follow
through and own results. We role model account-
ability and empowering everyone to grow.
Our guiding principles
OUR CULTURE AND LEADERSHIP / HOW WE ACT
READ MORE ON PAGE 200
We focus on strengthening trust, uniting our teams, and creating long-term
value by evolving how we think, act, lead, and work together – guided by our
shared culture that is everyone’s responsibility.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
20 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 21 =====
Human-centric customer
experience
We build lasting consumer relationships aligned with our
purpose: Personal, Sustainable and Safe.
We provide a premium offering across channels, aligned with
consumer expectations.
High-performing committed
organisation
We are a lean organisation with a regional structure that
enables speed, synergies and customer proximity.
We develop our people, foster a growth mindset and build
a high-performance culture.
Premium electrified products
for a regionalised world
We are committed to cost-efficient electrification with
hybrids as a bridge.
We are leaders in purposeful technology and real-life safety.
Our strategic direction to profitable growth
READ MORE ON PAGE 22 READ MORE ON PAGE 24 READ MORE ON PAGE 26
OUR STRATEGIC DIRECTION / WHERE WE WANT TO BE
Our strategic direction to profitable growth is unmistakable: we are building a stronger, more profitable Volvo
Cars. We are taking decisive actions to structurally position the company for long-term success – targeting
an EBIT margin of over 8 per cent, strong positive cash flows, and growth through electrification. Our strategic
direction is built on three pillars: Human-centric customer experience, High-performing committed
o rganisation and Premium electrified products for a regionalised world.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
21 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 22 =====
Safety is our founding principle and remains at the heart of
everything we do. Sustainability is not a checkbox, but a core
responsibility, to the planet and to our business. Technology is
never added for its own sake, but only when it truly enhances
people’s lives. This purposeful approach defines who we are
and how we will shape the future of mobility, while delivering an
exceptional customer experience.
When it comes to our cars, we are convinced that the future
is electric, because it is simply the better choice. We are ready
to go fully electric when our customers are. Today, we offer
fully electric models for those ready to make the shift, and
plug-in hybrids for markets and customers still transitioning.
Step by step, we are removing the key barriers of range,
charging speed, and cost, to make full electrification more
accessible.
Improving the buying experience – with possibility
for instant delivery
We are also making changes to how we package our various
offerings. Buying a car should be hassle-free. Customers deserve
clarity on what is included, transparent pricing, and flexible time-
lines based on individual preferences. Simplicity, transparency,
and precision are essential to building lasting relationships, and
we are now driving improvements across all these areas.
Through an ongoing pilot in Sweden, we are introducing a new,
convenient way to purchase a car online. Customers can choose
when their preferred car will be delivered – from immediate deliv-
ery to a time that best suits their individual needs.
We are also simplifying the offering by reducing the number of
variants, making it easier for customers while reducing complex-
ity for us. For those customers who prefer a complete solution,
we aim to provide a transparent consumer-friendly monthly price
that covers everything – from home charging solutions to insur-
ance, maintenance and other services simplifying the ownership.
Variant reductions further support a faster order-to-delivery pro-
cess with more digitalised tools and predictability, enabled by AI.
Human-centric customer experience
Everything starts with our brand – to offer something truly different with human
centricity across everything we do and aligned with our purpose: Personal, Sustainable,
and Safe. Across all channels, we are aiming to provide a premium experience tailored
to consumer expectations and designed to meet their needs seamlessly.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
22 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 23 =====
Marketing is a key driver of growth and prof-
itability. With our new approach, we aim to
attract more customers to the Volvo Cars
brand while lowering overall costs. Rather
than broad, one-size-fits-all campaigns, we
will focus on flagship models in priority loca -
tions and markets, creating powerful halo
effects that elevate our entire portfolio and
secondary markets.
This shift is supported by a truly data-
driven approach, where marketing spend is
continuously optimised based on what drives
brand impact and sales. Through A/B/C test-
ing and AI-enabled tools, we can quickly
evaluate and refine campaigns across all
channels. The direct connection between the
ad and offer on the website further creates
efficiency, shortening the lead-to-buy
process and acquisition cost.
This strategy enables us to deliver more
relevant, locally adapted messaging while
reducing total marketing spend per car.
NEW APPROACH TO MARKETING:
Leveraging halo
strategies to
strengthen brand
perception and
reduce cost
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
23 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 24 =====
Greater accountability, improved efficiency,
and faster decision-making
To support our ambition for profitable growth, we are now
implementing changes in our organisation and in the way we
work. Our new simplified structure is guided by the principle
that structure alone does not drive success. True performance
comes from the ability to seamlessly collaborate across func -
tions, enabling greater accountability, improved efficiency, and
faster decision-making. The approach includes fewer organisa -
tional layers, a reduction in managerial roles, and positions with
broader scope and increased responsibility.
A regional structure designed to enable speed
and customer proximity
To enable speed, create synergies, and maintain strong cus -
tomer proximity, we will operate as a lean organisation with a
regional structure. This approach allows us to respond quickly
to market changes, leverage local insights, and deliver consist -
ent value across regions. By reducing complexity and fostering
collaboration, we ensure agility and efficiency in every part of
the business.
Regionalisation enables a tailored approach in our key regions
across product, technology, manufacturing, and commercial
areas. This empowers regions to meet customer and retailer
needs faster, driving growth. The shift strengthens local account -
ability and decision-making while aligning roles with business
priorities. We will also develop and track certain regional metrics
to measure holistic performance across all functions.
Culture and Leadership
– Driving Performance and Engagement
At the same time, we focus on developing our people, fostering a
growth mindset, and building a high-performance culture. This
means empowering teams with the right tools, encouraging inno -
vation, and embedding accountability and continuous improve -
ment in daily work. Our goal is to combine operational excellence
with an engaged workforce for sustainable growth.
Our Culture and Leadership Principles guide behaviors, deci -
sions, and collaboration across the organisation. By embracing
these principles, we create an environment where innovation and
teamwork thrive – driving long-term high performance.
A high-performing
committed organisation
As part of our transformation journey, we are now implementing a simplified,
regional structure that enhances speed, accountability, and customer focus,
while embedding a culture of innovation and high performance.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
24 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 25 =====
In 2025, Volvo Cars launched an accelerated cost
and cash action plan totaling SEK 18 billion. As part
of the action plan, redundancies were announced.
In all, 3,000 positions including consultants, were
affected. These structural changes were consid -
ered essential to deliver on our cost efficiency
ambitions, while also improving operational effi -
ciency and accelerating decision-making.
The redundancy process was guided by fairness
and respect for each individual, transparency and
strategic alignment. Decisions were based on
length of employment and qualifications, aligned
with union agreements. Every position was evalu -
ated for affordability and long-term sustainability
rather than competence shift. Looking ahead, our
goal is a right-sized organisation that is lean, effi -
cient and future ready. We are embedding flexibil -
ity through global standards with room for regional
adjustments, ensuring resilience in a changing
industry.
Organisation fit
for the future
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
25 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 26 =====
Premium electrified products
for a regionalised world
Electrification is not just a technological shift – it is a significant opportunity for
Volvo Cars to grow profitably. Going forward, we will capitalise on our game-
changing, uncompromised BEV architecture, as well as our hardware collaboration
with Geely and our regionalised approach, to offer competitive and tailored products
for each market. And by introducing long-range PHEVs, we will also bridge the gap
for customers not yet ready to make the full transition to electric mobility.
Regionalisation: supporting a stronger offer
and increased profitability
As globalisation recedes, we need to adapt to a more regional -
ised world. This shift calls for a tailored approach across prod -
uct development, technology, manufacturing, and commercial
execution. By tailoring cars to specific market needs and cus -
tomer groups – using the right materials and technologies, built
in the right locations – we aim to reduce logistical and tariff
costs, while boosting growth. By empowering our regions to
respond to local customer needs and market dynamics, we
enhance our resilience and position ourselves for sustainable
growth.
Electrification: The way forward
Our commitment to going fully electric remains unwavering.
In 2025, 46% of our total sales were electrified, including both
fully electric and plug-in hybrid models, with nearly one in five
cars sold being fully electric.
We have a strong BEV portfolio and the new EX60, intro -
duced in the beginning of 2026, will significantly increase our
potential customer base as we now enter the largest and most
popular fully electric segment. The EX60 is a game-changer in
terms of price, performance and cost.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
26 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 27 =====
A pragmatic approach
While we are ready to go fully electric when our customers are,
varying rates of market adoption will mean different transition
speeds across regions. Demand for plug-in hybrids remains
stronger than expected, so to meet diverse local needs, we are
taking a pragmatic approach to our product strategy. Accord -
ingly, we will shape our PHEV lineup to provide an attractive
bridge for customers who want the benefits of a BEV but need
the back-up plan for occasional longer journeys – particularly
where charging infrastructure is still developing. We are making
affordable investments into substantial design and hardware
upgrades for our existing line-up of PHEVs, making them even
more compelling and relevant. And our second- generation
PHEVs, which will deploy the battery as the primary power
source with an engine as a back-up, will complete the bridge
towards electrification without the need for investment in new
platforms.
Increased collaboration with Geely
To further reduce costs and accelerate time-to-market, we
will expand our collaboration with Geely. The collaboration aims
to enable global hardware synergies, scale in Eastern technol -
ogy for China and collaborate on local products with shared
componens. Th e ambition is to increase synergies by leveraging
scale, reducing variants and increase commonality across prod -
ucts and platforms. Focusing on hardware, we aim to increase
common volumes of standardised modules. This will enhance
our sourcing power, improve access to innovation and technol -
ogy, reduce complexity, streamline development, and
strengthen resilience. For software there will be a clear separa -
tion between the Eastern and Western software stacks, where
Eastern technology for China will be in focus.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
27 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 28 =====
The launch of the EX60 marks the debut of SPA3 – our first
uncompromised BEV platform, delivering unprecedented
scalability and flexibility for future models.
SPA3 brings profound improvements on how we design,
develop, manufacture and improve cars. With the new plat -
form we will for the first time in history be able to continu -
ously develop and build cars of all sizes – larger than the
EX90 and smaller than the EX30 – using the same technol -
ogy base. The platform will be transformative for the prod -
ucts themselves, for our customers, and for our cost base.
By removing the constraints of the combustion engine,
SPA3 unlocks entirely new ways to scale and modularise
Fully software defined (one-track software)
SPA3 underlines our leadership in software defined vehicles.
Underpinned by one software stack, all our engineering
efforts can now be focused on a single direction to power all
our products. This approach ensures our cars improve over
time through continuous innovation and over-the-air updates.
It simplifies vehicle architecture by centralising computing,
reducing hardware complexity and cost. This approach
enhances safety, personalisation, and connectivity. It also
supports faster development cycles, better data utilisation,
and improved sustainability by extending hardware lifecycles
through software upgrades.
All-in-all, this will bring transformative advantages for the
products themselves, for our customers, and for our cost base.
cars, enabling a unified setup for batteries, e-machines,
climate control, chassis, and electronics.
Lower costs and accelerated innovation
Vertical integration of owned key technologies, like electric
motors, and software – reduces dependency on suppliers,
lowers costs, and accelerates innovation. Meanwhile horizon -
tal optimisation – leveraging shared platforms, components,
and partnerships across products – reduces complexity,
increases commonality, and improves economies of scale.
Combined, they will strengthen resilience, streamline devel -
opment, and support profitable growth in a competitive EV
market.
SPA3 – A game changer
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK
OUR GUIDING PRINCIPLES
OUR STRATEGIC DIRECTION
CUSTOMER EXPERIENCE
COMMITTED ORGANISATION
ELECTRIFICATION AND
REGIONALISATION
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
28 VOLVO CAR GROUP / OUR STRATEGIC FRAMEWORK
===== SIDA 29 =====
Directors’ report
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
29 VOLVO CAR GROUP
===== SIDA 30 =====
The Volvo Car Group
Volvo Car AB (publ.) together with its wholly-owned subsidiary
Volvo Car Corporation and its subsidiaries are jointly referred to as
“Volvo Car Group” or “Volvo Cars”.
Volvo Car AB (publ.), registration number 556810-8988, with its
registered office in Gothenburg, Sweden, is a publicly listed com -
pany on the Nasdaq Stockholm Stock Exchange traded under the
ticker VOLCAR. The largest owner, holding 78.65 per cent of shares
and capital, is Geely Sweden Holdings AB, owned by Shanghai Geely
Zhaoyuan International Investment Co., Ltd., registered in Shanghai,
China, and ultimately owned by Zhejiang Geely Holding Group Ltd.,
registered in Hangzhou, China. Volvo Car AB (publ.) holds shares in
its subsidiary Volvo Car Corporation and provides the Group with
certain financing solutions. Volvo Car AB (publ.), indirectly through
Volvo Car Corporation and its subsidiaries, operates in the automo -
tive industry with business relating to design, development, manu -
facturing, marketing and sale of cars and thereto related services.
Board of Directors’ Report
Volvo Cars’ sales development
Throughout the full year 2025, the global passenger car market
operated under challenging and uneven conditions, influenced by a
combination of macroeconomic pressures, geopolitical tensions, as
well as regulatory and trade-related developments. The industry’s
transition towards electrification progressed at a moderated pace
during 2025. Overall, the year was characterised by restrained
demand and intensified competition. The profitability of the indus -
try has been under pressure especially in the lights of tariffs and
writedowns by several OEM’s, leading to a heightened focus on
profitability as well as efficiency.
Volvo Cars’ full-year retail deliveries reached 710.0 (763.4)
thousand cars. Wholesales decreased by 11 per cent, and production
decreased by 9 per cent to 694.2 (760.4) thousand cars. Despite
the headwinds during 2025, Volvo Cars remained committed to nav -
igating uncertainty while positioning the business for sustainable
growth. The focus remains on efficiency, cost control and strength -
Key ratios, SEKm 2025 2024 2023 2022 2021
Retail sales, units 1) 710,042 763,389 708,716 615,121 698,693
Revenue 357,263 400,234 399,343 330,145 282,045
Research and development expenses –26,067 –16,983 –12,884 –11,514 –12,714
Operating income, EBIT 2) 303 22,318 19,939 22,332 20,275
EBIT excl. share of income from JVs and associates 2) –351 27,040 25,567 17,889 21,226
EBIT excl. Items affecting comparability 2) 12,556 24,020 20,563 16,433 16,995
Net income –2,968 15,934 14,066 17,003 14,177
Basic earnings per share, SEK 0.06 5.17 4.38 5.23 4.72
EBITDA2) 35,679 45,048 37,386 38,423 35,280
Cash flow from operating activities 34,625 47,372 42,867 33,599 29,852
Cash flow from investing activities –32,176 –46,245 –51,842 –39,658 –34,737
Net cash 2) 26,871 27,115 27,487 38,061 44,846
Gross margin, % 2) 16.9 19.8 19.4 18.3 21.6
EBIT margin, % 2) 0.1 5.6 5.0 6.8 7.2
EBIT margin % excl. share of income from JVs and associates 2) –0.1 6.8 6.4 5.4 7.5
EBIT margin % excl. Items affecting comparability 2) 3.5 6.0 5.1 5.0 6.0
EBITDA margin, % 2) 10.0 11.3 9.4 11.6 12.5
Equity ratio, % 39.8 36.6 36.6 35.4 33.4
Return on invested capital, ROIC, % 2) 0.2 12.0 12.4 16.7 18.6
1) Non-financial operating metric.
2) Non-IFRS measure (alternative performance measure), see Alternative performance measures on page 115.
ening the core business, providing a solid foundation for when market
conditions stabilise. Sales of BEVs decreased by 13 per cent to 151.8
(175.2) thousand cars, and PHEV sales decreased by 3 per cent
compared to 2024.
Retail sales (k units) 2025 2024 Change %
Europe 332.7 369.7 –10
China 149.5 156.4 –4
US 121.6 125.2 –3
Other 106.2 112.1 –5
Retail sales total 710.0 763.4 –7
Electrified cars 323.3 352.8 –8
whereof BEVs 151.8 175.2 –13
Electrified cars share 46% 46%
whereof BEV share 21% 23%
Wholesales 693.0 782.6 –11
Production volume 694.2 760.4 –9
Retail sales by model (k units) 2025 2024
BEV
EX30 78.6 98.1
EX40 44.0 53.4
EX90 16.3 1.8
EC40 11.8 20.4
EM90 0.8 1.5
ES90 0.3 —
Non-BEV
XC60 230.7 230.9
XC40 123.0 120.5
XC90 103.2 108.6
V60 27.1 34.1
S60 26.3 44.0
S90 25.7 40.2
XC70 14.2 —
V90 8.2 9.9
Total 710.0 763.4
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / DIRECTORS’ REPORT
30
===== SIDA 31 =====
Events during the reporting period
Two major tech upgrades in new Volvo cars
In January, it was announced that for the upcoming model year,
there will be two main tech upgrades for the XC40, EX40, EC40,
S60, V60, V60 Cross Country, V90 and V90 Cross Country models.
Volvo Cars is introducing our new-generation, new-look user expe -
rience to our whole lineup, as well as the ultra-fast Snapdragon®
Cockpit Platform from Qualcomm Technologies, Inc. This makes the
infotainment system much faster and much more responsive. Addi -
tionally, EX30, EX40 and EC40 models in Europe will get the service
Plug & Charge, for an even smoother public charging process.
EX30 Cross Country unveiled
In February, Volvo Cars unveiled the new Volvo EX30 Cross Country.
It is an all-road car that delivers safety, comfort and performance in
a capable and adventurous package. The Volvo EX30 Cross Country
is available to order in selected markets.
Volvo Cars completed the divestment of its 30 per cent
shareholding in Lynk & Co
In February, Volvo Cars divested its 30 per cent shareholding in Lynk
& Co Automotive Technology Co., Ltd to Zhejiang Zeekr Intelligent
Technology Co., Ltd., after approval at an Extraordinary General
Meeting of Volvo Cars’ shareholders, as well as other regulatory
approvals.
Volvo Cars revealed the all-new, fully electric Volvo ES90
In March, Volvo Cars revealed the ES90 which is the latest addition
to the balanced product portfolio of premium Volvo cars. The ES90
is the second car on the SPA2 platform equipped with a core com -
pute system and built on the Volvo Cars Superset Tech Stack. It was
then the sixth fully electric model in the line-up, joining the EX90,
EM90, EX40, EC40 and EX30 as the journey towards full electrifica -
tion continues.
Volvo Cars uses AI and virtual worlds with the aim of
creating safer cars
In March, Volvo Cars announced it is using AI-generated life-like
virtual worlds to enhance the development of its safety software,
such as driver assistance systems (ADAS), all with the aim of creat -
ing even safer cars. From now on Volvo Cars can synthesise incident
data collected by the advanced sensors in new Volvo cars, such as
emergency braking, sharp steering or manual intervention, which
allows Volvo Cars to probe, reconstruct and explore them in new
ways to better understand how incidents can be avoided.
The new Volvo S90 revealed for Asian market
In April, the new plug-in hybrid Volvo S90 was revealed for Asia.
The new S90 features our new-generation user interface, which, as
previously announced, is coming to our total line-up. In September
production started, using climate-neutral energy in Volvo Cars’
Chengdu plant.
Cost and cash action plan of SEK 18 billion
In April, Volvo Cars launched an accelerated cost and cash action
plan, totalling SEK 18 billion, to protect profitability, drive structural
efficiencies on direct and indirect spend, as well as helping to offset
external headwinds. The plan was executed during the year, with
removal of 3,000 positions, variable costs efficiencies from accel -
erated work on driving synergies through closer collaboration with
Geely, and cutting back on planned investments to improve cash
flow while safeguarding our future.
Volvo Cars and Google expand partnership
In April, Volvo Cars announce d an expanded partnership with
Google , to more rapidly deliver the latest Android Automotive OS
innovations to customers that own Volvo models with Google
built-in. Volvo Car s will now serve as one of Google’s reference
hardware platforms for future Android development in cars.
Volvo EX90 awarded
In April, the all-electric Volvo EX90 was appointed the most impres -
sive new luxury car launched in the past 12 months, by the World Car
Awards expert jury. Further, in November it was announced that in
the most recent round of Euro NCAP safety testing, the Volvo EX90
SUV earned the maximum five-star rating, placing it among the
highest-performing cars of 2025.
Volvo Cars introduced world first multi-adaptive safety belt
In June, Volvo Cars unveiled a major safety improvement to the
safety belt. The new multi-adaptive safety belt is a world-first tech -
nology aimed to further enhance safety for everyone in real-world
traffic situations. The new multi-adaptive safety belt can use data
input from interior and exterior sensors to customise protection,
adapting the setting based on the situation and individual’s profiles,
such as their height, weight, body shape and seating position. This
will be debuting in the upcoming fully electric Volvo EX60 in 2026.
In October, Volvo Cars was honoured for the second year in a row,
to be included on the TIME list for its latest safety innovation, as
multi-adaptive safety belt was recognised as one of the Best Inven -
tions of 2025.
Volvo Cars announced one-off SEK 11.4 billion non-cash
impairment charge
In June, Volvo Cars announced that the company is adjusting the
financial assumptions for the EX90 and ES90 platform, with reasons
including previous launch delays and new import tariffs in several
markets. The Volvo EX90 will have a reduced lifecycle profitability,
despite a major upgrade of software quality and a planned volume
ramp-up. This is due to significant launch delays in the past and
subsequent additional development costs.
Top 10 retail sales by market (k units) 2025 2024
China 149.5 156.4
US 121.6 125.2
UK 68.7 66.4
Germany 59.8 62.0
Sweden 47.9 46.2
The Netherlands 20.0 30.7
Belgium 17.4 25.2
Poland 15.3 14.9
Türkiye 15.2 13.0
Spain 15.2 18.0
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / DIRECTORS’ REPORT
31
===== SIDA 32 =====
Meanwhile, due to import tariffs the company is currently unable
to sell the Volvo ES90 profitably in the United States, while ES90
margins are also under pressure in Europe for the same reason.
In light of the above, Volvo Cars recorded a one-off non-cash
impairment charge of SEK 11.4 bn.
Volvo Car AB (publ.) resolved on repurchase of own shares
During the second quarter 2025, Volvo Cars repurchased a total of
12,500,000 own shares of class B, repurchased for a total amount
of SEK 218,866,471. Treasury shares are purchased to secure the
future delivery of shares to participants in Volvo Cars’ Performance
Share Plans (PSP) adopted by the Annual General Meeting in 2023,
2024 and 2025 and Employee Share Matching Plans (ESMP)
adopted by the Annual General Meeting in 2024.
During 2025, a total of 2,098,557 shares were distributed to
participants in the ESMP share matching programmes for 2022 and
2023, and a total of 526,799 shares for the PSP programme. As at
31 December 2025, Volvo Cars held 14,894,838 own shares.
Volvo Cars brings production of global best-seller
XC60 to its US plant
In July, Volvo Cars announced it will add its best-selling XC60
mid-size SUV to the production line of its US car plant in Charleston,
South Carolina. The Charleston facility, which also assembles the
fully electric flagship EX90, is scheduled to start XC60 production
in late 2026.
Volvo Cars completed its acquisition of NOVO Energy AB
In July, Volvo Car Corporation finalised the acquisition of Northvolt
AB’s shares in NOVO Energy AB and became 100% shareholder of
NOVO Energy AB. This completes the acquisition process which
began in October 2024 when Volvo Car Corporation notified its
counterpart in the joint venture NOVO Energy AB, Northvolt AB, that
Volvo Cars executed its redemption right to acquire Northvolt’s 50%
shareholding in NOVO Energy AB.
Reveal of the new Volvo XC70
In August, the new Volvo XC70 SUV was revealed. This is Volvo Cars’
first long-range plug-in hybrid, offering an all-electric driving range
of over 200km under the CLTC testing cycle – the longest of any
Volvo plug-in hybrid to date. It is designed to meet growing demand
for longer-range plug-in hybrids, particularly in China.
Volvo Cars continues to invest in South Carolina plant
In September it was announced that Volvo Cars will continue to
invest in its US car plant in Charleston, South Carolina, with the aim
of reaching full utilisation of the factory in coming years. Volvo Cars
has already invested USD 1.3 billion in the plant in the last decade, to
make it ready for the future. Through these investments, Volvo Cars
intends to deliver both volume and financial growth as well as using
the plant’s capacity. The Charleston plant currently has an installed
production capacity of 150,000 cars per year.
Volvo Cars’ Strategy Update Day
In November, Volvo Cars outlined the strategy going forward, at an
event for investors in Stockholm. During the event, Volvo Cars’
management team presented how the organisation is being struc -
turally built to achieve a long-term EBIT margin of over 8 per cent,
strong positive cash flows and growth through electrification.
Green financing 2025
In March, a drawdown of USD 438 m was made under an existing
bilateral loan facility with the purpose to finance investments that
meet the eligibility criteria set out in the Volvo Cars Green Financing
Framework. The facility was originally signed in 2023/2024 and will
mature in 2035.
In June, Volvo Cars issued its fifth green bond of EUR 500 m, with
a four-year tenor. The proceeds will support the ambition to be a
leading player in the premium electric car segment and achieve net-
zero greenhouse gas emissions by 2040. This includes funding
research and development of upcoming electric cars and platforms,
and related manufacturing processes. The bond, along with all our
previously issued green bonds, is listed on the Luxembourg Stock
Exchange.
In September, a new bilateral eight-year loan agreement of EUR
150 m was signed with the purpose to finance investments that
meet the eligibility criteria outlined in the Green Financing Frame -
work. The loan facility remains undrawn as per the end of 2025.
In October, an existing eight-year credit facility of CNY 3,090 m
was terminated, and the drawn amount of CNY 259 m was repaid.
In November, the first extension option on the existing
sustainability -linked Revolving Credit Facilities was exercised,
extending maturities by one year. The updated maturities for the
Revolving Credit Facilities of EUR 500 m and EUR 1,500 m are in
2028 and 2030, respectively.
Changes in Board of Directors and the Executive
Management Team
Changes to the Board of Directors
• On 31 March, Jim Rowan left the Board.
• On 3 April, Håkan Samuelsson was elected as a new member of
the Board. He previously served on the Volvo Cars Board and as
CEO from 2012 to 2022. He served as Chairperson of Polestar
until 2024.
• In June, Lone Fønss Schrøder stepped down from the Board of
Directors in Volvo Cars. At the same time she was appointed
Chairperson of the Board of Geely Sweden Holdings, and will
represent Geely Sweden Holdings in Volvo Cars’ Nomination
Committee.
• At an Extraordinary General Meeting (the “EGM”) of Volvo Car AB
(publ.) on 8 December 2025, the EGM resolved that the Board of
Directors shall consist of ten ordinary Board members elected by
the shareholders’ meeting without deputy Board members. Pieter
Nota and Caroline Grégoire-Sainte-Marie were elected as new
Board members until the end of the next Annual General Meeting.
Changes to the Executive Management Team
• In April, Håkan Samuelsson succeeded Jim Rowan as President
and Chief Executive Officer.
• Fredrik Hansson was appointed Chief Financial Officer (CFO),
effective from 24 April. He succeeded Johan Ekdahl, who left
Volvo Cars.
• From 1 June, Olivia Ross-Wilson left Volvo Cars and her position
as Global Head of Communication. She was succeeded by Jenny
Åström, and the position was moved from the EMT to the EMT
Extended (EMTe) team.
• Structural changes were made to EMT during August. Erik Sever -
inson was appointed Chief Commercial Officer and Michael Fleiss
replaced Erik Severinson as Chief Strategy & Product Officer. In
addition, Volvo Cars appointed Product Line Owners for its prod -
uct lines. These are a part of the EMT Extended (EMTe) team and
report to the Chief Commercial Officer.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / DIRECTORS’ REPORT
32
===== SIDA 33 =====
Research and development
Over the past year, Volvo Cars has made significant progress in
research and development, centred on the introduction of SPA3,
the company’s next-generation, fully electric vehicle architecture.
Designed as an uncompromised battery electric vehicle (BEV) plat -
form, SPA3 represents a major technological step forward, enabling
scalability across the full product range, from compact to large
premium electric vehicles, while meeting requirements for perfor -
mance, cost efficiency, quality and sustainability.
During the year, Volvo Cars has also completed a major transfor -
mation toward software-defined vehicles by unifying its entire
product portfolio, including new BEVs and next-generation plug-in
hybrids, on a single software architecture. This “one-track” software
approach enables faster development, continuous over-the-air
upgrades, improved quality and long-term product competitiveness,
while allowing functionality and performance to improve throughout
the vehicle lifecycle.
Collectively, these developments position Volvo Cars at the fore -
front of electric and digital vehicle technology. SPA3 is delivered on
time, on cost and on quality, and forms a foundational platform for
future products such as the newly launched EX60. The past year has
marked a decisive shift toward fully electric, software-centric vehi -
cles designed to evolve continuously and deliver long-term value to
both customers and the business.
Environment
Volvo Cars has a long-standing commitment to being a responsible
company with a clear focus on sustainable development. Volvo Car
Group’s Sustainability Statement has been prepared in accordance
with the Swedish Annual Accounts Act, chapter 6, European
Sustainability Reporting Standards (ESRS) and the EU Taxonomy
Regulation. The scope and content of the Sustainability Statement
is defined on page 133 in this report.
Employees
In 2025, Volvo Car Group on average employed 42.6 (42.6) thou-
sand full-time employees (FTEs) and 2.3 (3.4) thousand agency
personnel. The main driver behind the reduction in agency person -
nel is the effect from the restructuring programme. That effect is
also visible for FTEs when comparing year end figures for 2025 with
2024 by about 2.3 thousand employees.
Proposed distribution of non-restricted equity
The parent company
The following funds are at the disposal of the Annual General
Meeting (AGM):
Share premium reserve SEK 31,653,517,859
Retained earnings brought forward SEK 5,083,584,404
Net income for the year SEK 4,355,103,303
At the disposal of the AGM SEK 41,092,205,566
The Board proposes the following allocation of funds:
Carried forward SEK 41,092,205,566
Significant events after the reporting period
On 7 January, Volvo Cars announced the appointment of Thomas
Ingenlath as Chief Design Officer, effective 1 February 2026.
On 21 January, the new Volvo EX60 was released, as the newest
entry in our portfolio of electrified cars.
On 17 February, Volvo Cars’ largest shareholder, Geely, reported an
increase in its holdings in Volvo Cars by 0.22 per cent, as Geely
International Hong Kong Limited purchased approximately 6.54
million shares between 6-16 February. After those transactions,
Geely’s total ownership percentage in Volvo Cars is 78.87 per cent.
The Nomination Committee’s proposal for election of
members to the Board of Directors of Volvo Car AB (publ.)
The Nomination Committee of Volvo Car AB (publ.) has decided to
submit the following proposals for resolution at the Annual General
Meeting of shareholders on 31 March 2026:
Re-election as members of the Board of Directors: Eric Li (Li Shufu),
Daniel Li (Li Donghui), Håkan Samuelsson, Jonas Samuelson,
Diarmuid O’Connell, Lila Tretikov, Ruby Lu (Rong Lu) and Pieter
Nota.
Re-election of Eric Li (Li Shufu) as Chairperson of the Board of
Directors.
Anna Mossberg and Caroline Grégoire Sainte Marie have declined
re-election.
The Nomination Committee proposes Natalie Knight and Markus
Schäfer to be elected as new members of the Board of Directors.
Markus Schäfer with effect as of 1 July 2026.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / DIRECTORS’ REPORT
33
===== SIDA 34 =====
Remuneration guidelines to senior executives
The following principal guidelines for remuneration to senior execu -
tives were adopted at the Annual General Meeting held on 3 April
2025. These guidelines shall be applicable to remuneration to the
Executive Management Team, including the CEO, (“EMT”) of Volvo
Car AB (“Volvo Cars”). The guidelines imply that the People Com -
mittee, instead of Board of Directors in its entirety, is responsible for
certain resolutions pursuant to these guidelines.
Types of remuneration
The total remuneration package for the EMT may consist of the
following components; fixed remuneration, variable remuneration,
pension benefits and other benefits. The components of remunera -
tion shall be in accordance with local market practice. Additionally,
the general meeting may – irrespective of these guidelines – resolve
on, among other things, share-related or share price-related remu -
neration. Please refer to Share-based or share price-related incen -
tive programmes below.
Variable cash remuneration
The satisfaction of criteria for awarding short-term variable cash
remuneration shall be measured over a period of one year, whereas
the satisfaction of criteria for awarding long-term variable remuner -
ation shall be measured over a period of three years.
For the CEO, the short-term variable cash remuneration may not
amount to more than 200 per cent of the annual fixed base salary
on 31 December at the end of each performance year, and the long-
term variable remuneration may not amount to more than 150 per
cent of the annual fixed base salary the year the programme was
implemented. For the other EMT members, the short-term variable
cash remuneration may vary but not amount to more than 140 per
cent of the annual fixed base salary on 31 December at the end of
each performance year, and the long-term variable remuneration
may vary but not amount to more than 120 per cent of the annual
fixed base salary the year the programme was implemented. For
information on the criteria for awarding short- and long-term varia -
ble remuneration, please refer to Criteria for awarding variable
remuneration below.
Extraordinary arrangements
Further variable remuneration may also be paid out in extraordinary
circumstances, provided that such arrangement is of a one-time
nature and is agreed on an individual basis for management recruit -
ment or retention purposes or as compensation for extraordinary
efforts beyond the individual’s ordinary assignment. Such remuner -
ation shall be in line with market practice and may for example
include a one-time cash payment, retention bonus or severance
payment in case of a change of control, or similar. The remuneration
may not amount to more than the annual fixed base salary for 1 year
and shall not be paid more than once a year per individual. Resolu -
tions on such compensation shall be made by the People Committee
based on a proposal from the CEO if an EMT member (other than the
CEO) is concerned and by the People Committee and the Chairper -
son of the Board of Directors, or the Vice Chairperson as delegated,
if it relates to the CEO.
Share-based or share price-related incentive programmes
The Board of Directors may, irrespective of these guidelines, pro -
pose the general meetings to resolve on long-term share-based or
share price-related incentive programmes. During the previous
annual general meetings held from 2022 and onwards, the Board of
Directors proposed, and the annual general meetings approved
long-term share-based incentive programmes comprising, amongst
others, the EMT. The Board of Directors intends to propose forth -
coming annual general meetings to approve similar incentive pro -
grammes. No new long-term variable cash programmes will there -
fore be offered to the EMT as long as there is a long-term
share-based programme in place.
Criteria for awarding variable cash remuneration
The variable short-term cash remuneration shall be linked to prede -
termined and measurable criteria which can be financial or non-fi -
nancial. The criteria for the variable short-term remuneration shall
be determined yearly by the People Committee.
Variable long-term remuneration, which is not approved by the
annual general meeting, if any, shall be linked to the satisfaction of
certain financial performance conditions determined by the People
Committee and measured over the term of the programme.
For both short-term and long-term variable remuneration, the crite -
ria may also be individualised, quantitative or qualitative objectives.
The criteria shall be designed to contribute to the company’s busi -
ness strategy and long-term interests, including its sustainability.
To which extent the criteria for awarding variable remuneration
have been satisfied shall be evaluated when the measurement
period has ended. The People Committee is responsible for the
evaluation. For financial objectives, the evaluation shall be based on
the latest financial information made public by the company.
Pension benefits
For the CEO, pension benefits shall be a defined contribution
scheme, and the pension premiums may amount to not more than
50 per cent of the annual fixed base salary. Variable remuneration
shall not qualify for pension benefits.
For other EMT members, pension benefits shall be a defined con -
tribution scheme, and the pension premiums may amount to not
more than 30 per cent of the annual fixed base salary. No current
EMT members have a defined benefit pension. However, defined
benefit pension can be offered to future EMT members as part of
a pre-existing agreement. To the extent that variable remuneration
qualifies for pension benefits under the applicable collective
bargaining agreement, the pension benefits shall be deducted from
the payment and paid as pension.
Other benefits
Other benefits may include, for example, medical insurance, annual
health check-up and company cars. Such benefits may amount to
not more than 20 per cent of the annual fixed base salary.
For employments governed by rules other than Swedish, pension
benefits and other benefits may be duly adjusted for compliance
with mandatory rules or established local practice, taking into
account, to the extent possible, the overall purpose of these
guidelines.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / DIRECTORS’ REPORT
34
===== SIDA 35 =====
EMT members who are expatriates (i.e., are sent on an international
assignment and are not on a local employment contract) may
receive additional remuneration and other benefits determined in
line with the company’s International Assignment Instruction which
may include (but are not limited to) relocation cost, cost of living
allowance, housing, schooling, home travel allowance and tax assis -
tance. Such benefits may amount to no more than 160 per cent of
the annual fixed base salary.
Clawback
The Board of Directors shall have the possibility, in accordance with
applicable law or contractual provisions, to in whole or in part
reclaim variable remuneration paid on incorrect grounds.
Termination of employment
Upon termination of an employment, the notice period may not
exceed twelve (12) months. Fixed base salary during the notice
period and severance pay may together not exceed an amount
corresponding to the individual’s fixed base salary for two (2) years,
subject to applicable law.
When termination is made by the EMT member, the notice period
may not exceed twelve (12) months, without any right to severance
pay.
Additionally, remuneration may be paid for non-compete under -
takings. Such remuneration shall compensate for loss of income and
shall only be paid in so far as the previously employed executive is
not entitled to severance pay. The remuneration may amount to not
more than 60 per cent of the monthly fixed base salary at the time
of termination of employment and be paid during the time the
non-compete undertaking applies, however not for more than
twelve (12) months following the termination of employment.
Salary and employment conditions for employees
In the preparation of the Board of Directors’ proposal for these
remuneration guidelines, salary and employment conditions for
employees of the company have been taken into account by includ -
ing information on the employees’ total income, the components of
the remuneration and increase and growth rate over time, in the
People Committee’s and the Board of Directors’ basis of decision
when evaluating whether the guidelines and the limitations set out
herein are reasonable.
Share ownership guidelines for members of the EMT
Since the Board of Directors believes that long-term share owner -
ship is an important way to create alignment between the EMT
members and Volvo Cars’ shareholders, it has implemented the
following policy of share ownership for members of the EMT.
As per the policy, the Board of Directors expects the CEO and other
members of the EMT to accumulate personal holdings in shares with
a market value corresponding to the value of 100 per cent of the
EMT member’s gross annual fixed base salary. When calculating the
value of the personal holdings, the market value of the shares at
each investment instance shall be used. It is expected that the
personal holding of shares be established within five years from the
listing of the company and, for new hires, within five years from
commencement of employment with the group as CEO or as a
member of the EMT. The CEO and other members of the EMT shall
retain shares allotted (net after taxes payable) under future incen -
tive programmes to achieve the expected share ownership. Further,
upon reaching the recommended share ownership level, it is
expected that the CEO and the other members of the EMT maintain
shares of such value for the duration of their appointment as CEO or
the other member of the EMT.
Remuneration guidelines governance
The Board of Directors has established the People Committee,
whose tasks include preparing the Board of Directors’ decision to
propose guidelines for EMT remuneration. The Board of Directors
shall prepare a proposal for new guidelines at least every fourth
year and submit it to the general meeting. The guidelines shall be in
force until new guidelines are adopted by the general meeting.
The People Committee shall also monitor and evaluate variable
pay programmes, the application of the guidelines for executive
remuneration as well as the current remuneration structures and
compensation levels in the company.
The members of the People Committee are independent of the
company and its executive management. Neither the CEO nor any
other EMT member participate in the Board of Directors’ decision -
making process on any resolutions regarding remuneration-related
matters as far as that could potentially affect their own remunera -
tion.
Deviation from the guidelines
The Board of Directors may temporarily resolve to deviate from the
guidelines, in whole or in part, if in a specific case there is special
cause for the deviation and a deviation is necessary to serve the
company’s long-term interests, including its sustainability, or to
ensure the company’s financial viability. The People Committee’s
tasks shall include preparation of any resolutions to deviate from
the guidelines.
The Board of Directors’ proposal to guidelines for
executive remuneration 2026
The Board of Directors of Volvo Car AB (“Volvo Cars”) proposes no
changes to the guidelines for remuneration to the Executive Man -
agement Team (including the CEO and any deputy CEO) (“EMT”) for
the 2026 Annual General Meeting. The current guidelines, adopted
by the Annual General Meeting held in April 2025, remain applicable
for 2026.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT
RISK 36
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / DIRECTORS’ REPORT
35
===== SIDA 36 =====
Risk
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
36 VOLVO CAR GROUP
===== SIDA 37 =====
Risk is an inherent aspect of business, encompassing both potential
threats and opportunities. Effective risk management not only miti -
gates adverse impacts but also enables the identification of oppor -
tunities and the creation of value. At Volvo Cars, the risk manage-
ment process is designed to support the organisation in identifying,
managing, and monitoring critical risks that may affect the achieve -
ment of our financial targets and strategic objectives. The ability to
recognise and adapt to evolving threats is a cornerstone of our risk
management approach.
Enterprise Risk Management (ERM) is integrated into the business
with the objective of enhancing decision-making, proactively safe -
guarding the execution of strategies and plans, and protecting cor -
porate assets. Volvo Cars is committed to fostering a systematic
approach to risk management, underpinned by organisational cul -
ture, business insights and accountability. This approach is aligned
with industry best practices.
Risk Landscape
The top risks identified for 2025 are closely related to Volvo Cars’
strategic priorities— Electrification, Regionalisation and Profitability.
The risks related to advanced technological developments for
future car models have been reduced. However, ongoing geopolitical
tensions, technological decoupling and trends towards deglobalisa -
tion continue to shape the risk landscape.
A key strength of Volvo Cars lies in our ability to swiftly identify and
respond to emerging threats, reinforcing our organisational resilience.
In 2025, the automotive industry faced considerable challenges in
major markets such as China, Europe, and the United States mainly
driven by uncertainties in the economic development and geopolitical
instability. The geopolitical situation with rising tariffs and trade barri-
ers between the US, China and Europe are also affecting the supply
chain with financial distressed suppliers as one of the examples.
While electric vehicle (EV) growth remains strong in China,
demand in Europe and the U.S. is more moderate, hindered by pricing
pressures, fierce competition, reduced subsidies and infrastructure
limitations.
In response, Volvo Cars is recalibrating its electrification timeline
and optimising the balance between battery electric vehicles (BEVs)
and plug-in hybrid electric vehicles (PHEVs). The company is prior -
itising cost reduction and cash preservation to sustain profitability
and growth.
Governance
The Board of Directors holds ultimate responsibility for ensuring that
all risks (including those related to climate and nature) are ade -
quately managed. Certain responsibilities are delegated to the Audit
Committee and the People Committee. Operational risk manage -
ment is overseen by the Chief Executive Officer and the Executive
Management Team (EMT), with the Head of ERM reporting the top
risks biannually to the Executive Management Team and the Board of
Directors.
Risk input is collected quarterly from across the organisation via
local risk managers, resulting in a comprehensive risk overview. Each
identified risk is assigned a risk owner responsible for managing the
risk in accordance with Volvo Cars’ Risk Management principles.
Prior to formal reporting, a dedicated ERM Core Team, consisting
of senior managers across the company, conducts a thorough review
and prioritisation of risks from a cross-functional perspective.
Additionally, the Internal Audit function serves as the third line of
defense, providing independent assurance on the effectiveness of
risk management practices.
Enterprise Risk Management
CONTEXT
Consists of the policies, strategies,
plans, targets, purposes and other
steering principles tha t are
pointing out the direction of the
business.
BUSINESS PROCESSES
The analysis, decision-making and
execution necessary to move in
the right direction.
RISKS
External and internal uncertain -
ties, threats and weaknesses that
can make us deviate from the
intended direction.
RISKS
CONTEXT
BUSINESS
PROCESSES
RISK MANAGEMENT (RM)
Is the combined countermeasures
taken to manage risks. Integrated
RM means that it is primarily
driven by the business where the
RM roles support with tools and
competence.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK
ENTERPRISE RISK MANAGEMENT
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / RISK
37
===== SIDA 38 =====
For sustainability-related risks and opportunities, Volvo Cars
adheres to the requirements in the European Sustainability Report -
ing Standards (ESRS) and conducts yearly materiality assessments.
More information can be found on page 145.
Risk Culture
Risk management at Volvo Cars is influenced by COSO and
ISO31000, thus understanding that all functions address the risks
inherent in their daily responsibilities. This is further reinforced
through training given to different target groups including risk
management principles, procedures, directives and guidelines.
Volvo Cars adopts a holistic approach to risk management, begin -
ning with governance and taxonomy that promote collaboration and
transparent decision-making. This approach is closely aligned with
corporate strategy and the corresponding risk and opportunities.
The company embraces calculated risks in pursuit of our strategic
objectives, ensuring a balanced approach to opportunity and risk.
Risk Management Practices
The Risk Management function at Volvo Cars is designed to be
dynamic, iterative, and responsive to change. A dynamic approach
acknowledges the rapidly evolving and interconnected nature of the
risk landscape. An iterative process ensures that the risk manage -
ment cycle remains continuously active and embedded within the
business. As our business context and model evolve, so too must our
risk management practices.
Our aim is to ensure that risk management is driven by business
insights and accountability integrated into daily operations and
aligned with best-in-class methodologies.
Approach to Risk
At Volvo Cars, our risk management approach is tailored to the
nature of each risk category. This strategic alignment ensures that
risks are addressed appropriately across the organisation.
Risk Quantification
The Risk Management function is responsible for developing and
maintaining a standardised risk quantification model. This model
enables consistent evaluation of risks using impact and likelihood
parameters in line with ISO 31000, distinguishing enterprise-level
risks from functional ones. Risks are assessed across six impact
dimensions, with high-impact, high-likelihood risks prioritised by the
Executive Management Team. The ERM Core Team consolidates and
reviews reported risks before presentation to the Executive Manage -
ment Team and Board of Directors.
Risk Drivers and Accelerators
Certain macro-level factors, though not risks in themselves, act as
accelerators, influencing the pace and emergence of risks. These
drivers are integral to Volvo Cars’ strategic planning. Intelligence
gathering on trends supports proactive decision-making and
enhances preparedness.
Further insights on industry trends and strategic responses are
available on pages 15–28.
APPROACH TO RISK
STRATEGIC
Averse
Cautious
Minimalist
Open
Hungry
Medium – High risk appetite because of high
opportunities. High management attention.
Wide range due to wide range of risk areas. Each area
to do cost benefit analysis and review insurable risks.
Strong process control.
Wide range connected to relevant business
decisions. Strong second line control. Normally
include s both downside and upside.
Zero to Low appetite, strong first and second line
control. Company policies set the principles.
Note
OPERATIONAL
FINANCIAL
COMPLIANCE &
FINANCIAL REPORTING
GEOPOLITICAL
DEVELOPMENTS
MACROECONOMIC
DEVELOPMENT
THE COMPETITIVE
ENVIRONMENT AND
TECHNOLOGICAL
DEVELOPMENT
BARRIERS FOR
EXECUTION
RISK DRIVERS AND ACCELERATORS
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK
ENTERPRISE RISK MANAGEMENT
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / RISK
38
===== SIDA 39 =====
Key Risks for 2025
This section summarises the top prioritised risks for 2025, including descriptions, response
actions, and outlooks indicating whether risks are increasing, stable, or decreasing.
STRATEGIC RISKS
Risk Description Response Outlook
Challenges with market
shift, intense competition
and consumer behaviour
in electrification transfor-
mation
As customers move towards electric vehicles, there is uncertainty
on the pace of consumer acceptance, market by market. The move
from ICE vehicles to BEV is dependent on factors like range, charg -
ing experience and price. In combination with geopolitical develop -
ments, removal of EV incentive programs, uncertainties in regula -
tory requirements on emission reduction and impacts from instable
macroeconomics there is a risk of adverse effects on our growth
plans both with regards to volumes and margins. In addition to this,
shifting regional market demands put pressure on us as competition
continuously increases.
The launch of fully electric vehicles on new platforms with competitive range and
improvements of the existing ICE/PHEV/BEV cars are examples of our commitment
to our strategy to balance commercial demands. There is also a regional set-up to
adapt car models to local differences.
Continued uncertainties due to the
instability in livelihood circumstances
for our customers in combination with
increased competition.
Geopolitical tensions
and regionalisation resulting
in increased taxes/duties/
tariffs and export controls
Geopolitical regionalisation introduces risk of increased protection -
ism as countries and regions impose trade restrictions and trade
taxes/duties/tariffs/ licensing/controls on technology, which leads
to technology decoupling and increased costs.
With our global presence, we are naturally partly hedging the regional differences
between our markets. Our ambition to build where we sell is progressing through
our established global manufacturing footprint and increased local sourcing where
relevant.
Regionalisation is accelerating amid
global deglobalisation, with no signs of
near-term stabilisation.
Scarcity of secondary
and low-emission resources
& technology
Global demand of secondary materials and low-emission resources
and technology is outpacing supply. The effect on availability and
prices may affect Volvo Cars’ ability to source strategic inputs
needed to achieve its environmental goals, comply with evolving
regulations, and maintain cost competitiveness in a dynamic market
landscape.
Volvo Cars is deepening its strategic collaborations with suppliers and partners,
investing in innovation and circularity, and developing flexible sourcing strategies
to enhance access to key resources and technologies that deliver financial value
while supporting its long-term sustainability ambitions.
While the external environment remains
uncertain and resource constraints are
expected to persist, Volvo Cars is com-
mitted to deepening its resilience and
adaptability.
Risk Categories
Volvo Cars classifies risks into four primary categories:
• Strategic – Risks that might impact reaching
strategic objectives
• Operational – Risks that might interfere with
operations
• Compliance – Risks that might impact our
compliance with laws and regulations.
• Financial – Risks that might impact the financial
result and/or valuation
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK
ENTERPRISE RISK MANAGEMENT
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / RISK
39
===== SIDA 40 =====
OPERATIONAL RISKS
Risk Description Response Outlook
Cyber risk The importance of cybersecurity is increasing in order to ensure
a resilient business. Cybercriminals are well organised and pose
a multitude of threats to organisations, for instance ransomware,
information theft, fraud and more.
Both the cybersecurity industry and regulators are addressing
these threats with a mix of regulations, standards, services, and
tools to mitigate the threat and impact.
Volvo Cars has a global and diverse digital footprint, and cyber -
security is essential in protecting all digital assets and critical
business processes.
Volvo Cars Cybersecurity organisation has a global footprint and is
equipped to manage cybersecurity risk company wide.
A governance model is in place with policies, standards, advisory,
security practices implementation and incident services. An overar -
ching Cybersecurity program addresses improvement areas across
company functions globally. Reporting is provided regularly to the
Executive Management and the Board of Directors.
The cyber risk continues to increase in general and poses
a risk to Volvo Cars.
Geopolitical Disruption
Risk in Battery Supply and
Technology Platforms
Volvo Cars is exposed to heightened risks from global geopolitical
tensions, particularly regarding advanced battery supply and
unified technology platforms. Reliance on batteries and digital
components sourced from specific regions, especially China,
increases vulnerability to trade restrictions, regulatory changes,
and supply chain disruptions. These factors, combined with the
push for a unified tech stack, may impact operational flexibility,
innovation, and brand reputation.
The company is proactively strengthening quality controls,
diversifying supply chains, and adapting its business model to
regional needs, while maintaining a clear focus on brand integrity,
responsible business practices and customer trust.
While the external environment remains uncertain, Volvo
Cars is committed to a clear strategy and continuous
improvement to support sustainable growth and protect
its reputation.
Business interruption Volvo Cars may experience disruption to manufacturing, design
and research and development capabilities for a variety of
reasons, such as natural disasters, environmental degradation,
acts of war, epidemics and other external events.
Business interruption is to a certain extent an insurable risk
although the impact may go beyond direct financial impact.
Mitigation actions and investments are done to increase resilience.
Due to the Russia-Ukraine war, instability in the Middle
East, the geopolitical climate and increased frequency/
impact natural disasters posed by accelerated environ -
mental degradation, the risk remains high.
COMPLIANCE RISKS
Risk Description Response Outlook
Compliance with global
regulatory requirements
Ensuring compliance with regulatory requirements is critical to
avoid fines, legal actions, and reputational damage. Several of the
compliance risks faced by Volvo Cars are driven by geopolitical
developments. Operating in markets with varying regulatory
standards increases complexity and cost while maintaining
compliance across all jurisdictions.
Volvo Cars must continuously adapt its products, services, business
processes and policies to remain compliant. This requires ongoing
monitoring and a proactive approach to regulatory changes,
which can be resource intensive. Ensuring that our teams are well-
informed and trained on regulatory requirements across all areas
of the business is essential to mitigate this risk.
The complexity of the global regulatory landscape is
increasing, driven by geopolitical developments.
Non-compliant
Cross-Border Data
Transfers
Cross-border data transfers expose Volvo Cars to risks arising
from national and regional data protection restrictions and data
localisation requirements. The risks pertain to non-compliant
movement of, or access to, personal or sensitive data across juris -
dictions. The regulatory requirements continue to emerge and
differ between countries (e.g. GDPR (EU), PIPL (China), Data
Security Program (US), and DPDP (India)).1)
Ongoing monitoring of regulatory developments and implementa -
tion of relevant compliance activities to prevent unauthorized
cross-border data transfers e.g., adoption of steering documents,
awareness trainings and adding controls in data and engineering
frameworks.
The risk is increasing, driven by heightened geopolitical
tensions and accelerating regulatory development. In
addition to privacy regulations, many countries are tight -
ening controls over foreign access to domestic data for
national security reasons.
1) GDPR = General Data Protection Regulation, PIPL = Personal Information Protection Law, DPDP act = Digital Personal Data Protection act.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK
ENTERPRISE RISK MANAGEMENT
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / RISK
40
===== SIDA 41 =====
FINANCIAL RISKS
Risk Description Response Outlook
Macroeconomic
development
Risk for negative effect on business due to deteriorating macro -
economics, unstable geopolitical landscape, regional protection -
ism and potential recession with lower purchasing power among
consumers. Also, risk that our supply chain will be affected in a
potential market decline.
Dependent on how the macro environment develops, Volvo Cars
can adjust the timing or reduce the size of investments to protect
the cash flow. A close co-operation with our supply chain also
supports the mitigation of these risks.
Global growth to be moderate but stable around 3.0
per cent as trade policy uncertainty has diminished. Fiscal
and monetary policy to provide support in 2026. Recovery
in euro area but with structural headwinds. Fragmented
US economy with technology-driven growth. Chinese
growth expected to decline.
Additional Risk Management Areas
While the ERM section focuses on top group-level risks, extensive
risk management activities occur daily across the organisation. Key
areas include:
• Financial Risks – Managed in areas such as hedge accounting,
currency exposure, funding, interest rates, commodity pricing, and
credit. Detailed disclosures are provided in Note 19.
• Environmental risk – Climate and nature-related risks are identi -
fied using scenario analyses and materiality assessments, follow -
ing ESRS requirements, and integrated into strategy and risk
management processes. Further details can be found in the
Sustainability Statement, starting on page 130.
• Responsible Business Risks – Emphasising social responsibility
and business conduct, this area includes initiatives to promote
inclusion and ensure ethical practices. Further details can be
found in the social and governance section of the Sustainability
Statement, starting on page 179.
COMPLIANCE RISKS, continued.
Risk Description Response Outlook
Potential human rights
violations in our full value
chain
Volvo Cars has a global and complex value chain including opera -
tions in and sourcing from high-risk countries. This means that it
is important to safeguard fundamental human rights and minimise
the risk that human rights violations occur at any instance of our
total value chain. Failure to do so could lead to legal, financial, and
reputational consequences, as well as supply chain disruptions.
A human rights compliance program, built on international guide -
lines, has been established to guide operations – e.g. requiring key
due diligence activities across our value chain to identify and reme -
diate potential issues.
The public’s expectations and awareness are increasing.
Current and new national and regional legislations are
increasing in scope and enforcement and put more
responsibility on global companies’ due diligence efforts.
Upcoming EU Corporate Sustainability Due Diligence
legislation will help standardise expectations according to
international guidelines and will require more detailed
documentation, governance oversight, and remediation
processes.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK
ENTERPRISE RISK MANAGEMENT
CORPORATE GOVERNANCE 42
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / RISK
41
===== SIDA 42 =====
Corporate
governance
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
42 VOLVO CAR GROUP
===== SIDA 43 =====
VOLVO CAR AB (PUBL.) BOARD OF DIRECTORS
Corporate governance within Volvo Car Group
The purpose of Volvo Car Group’s corporate governance is to create
a strong foundation for active and responsible ownership, a proper
distribution of responsibilities between the different company bod -
ies, as well as proper communication with all of the Group’s stake -
holders with the purpose of driving sustainable growth and good
governance.
The corporate governance principles adhered to by Volvo Car
Group are based on Swedish law, mainly the Swedish Companies Act
(Sw. Aktiebolagslagen (2005:551) and the Swedish Annual Accounts
Act (Sw. Årsredovisningslagen (1995:1554)), the Swedish Code of
Corporate Governance (the “Code”) and Nasdaq Stockholm’s rule -
book for issuers as well as other relevant laws and regulations. The
Code is based on the “comply or explain” principle, meaning that
companies are not obliged to at all times apply every rule in the
Code, but are allowed the freedom to choose alternative solutions
which are better suited for their particular circumstances, provided
they report every deviation, describe the alternative solution and
explain the reasons for the deviation.
Volvo Car Group applies the principles of sound corporate govern -
ance and responsible business practice, and the Code without any
deviations.
The Board of Directors of the Company (the “Board”) is responsi -
ble for Volvo Car Group’s organisation and the management of its
business worldwide and is obliged to follow directives provided by
the General Meetings. The Board may appoint committees with
specific areas of responsibility and furthermore authorise such com -
mittees to decide on specific matters in accordance with regulations
established by the Board.
The Board has decided to delegate certain tasks related to
sustainability reporting to the Audit Committee. The responsibility
for sustainability matters in general, including but not limited to the
strategic aspects thereof, stays with the Board. As of 20 September
2023, the Board decided to incorporate a new temporary China
Committee with the purpose to prepare, and review matters on
behalf of the Board regarding the strategic direction and develop -
Corporate Governance Report
BOARD OF DIRECTORS COMMITTEES
EMT/EMTe FORA
SUPPORTING GOVERNANCE FORUM
SUPPORTING GOVERNANCE
FUNCTIONS
COMPLIANCE COMMITTEESGLOBAL AUDIT OFFICE (GAO)
(Reports to Audit Committee)
ENTERPRISE RISK
MANAGEMENT
COMPLIANCE AND
ETHICS OFFICE
DISCLOSURE COMMITTEEINTERNAL CONTROL
PRODUCT BOARD
SHAREHOLDERS THROUGH
SHAREHOLDERS’ MEETINGS
PEOPLE COMMITTEE
DIGITAL BOARD
EXTERNAL AUDITOR
EXTENDED EXECUTIVE MANAGEMENT TEAM (EMTe)
AUDIT COMMITTEE
CORPORATE BOARD
NOMINATION COMMITTEE
CEO AND EXECUTIVE MANAGEMENT TEAM (EMT)
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE
43
===== SIDA 44 =====
ment of Volvo Cars’ business in China. In September 2025, the Board
decided to discontinue the China Committee since the Board con -
cluded that it has fulfilled its purpose due to the new regionalisation
strategy and the new governance structure for China (see under
“Regionalisation” on page 50. Following this decision, the Board’s
committees consist of the Audit Committee and the People
Committee.
The Chairperson of the Board directs the work of the Board and
monitors the Board’s fulfilment of its obligations. Until June 2025,
a Vice Chairperson was also appointed to support the Chairperson as
appropriate. The existing Vice Chairperson stepped down from her
position in June 2025 whereafter no new Vice Chairperson has been
appointed. The Board has adopted and regularly updates its rules of
procedures, which outline the principles on governance of the Board
and its committees.
The President of Volvo Car Group, who also serves as the Chief
Executive Officer (CEO), is appointed by the Board to manage the
Group’s daily operations and lead the Executive Management Team
(EMT) under the Board’s supervision. A broader Extended Executive
Management Team (EMTe) has also been established, consisting of
EMT and other key roles.
Shareholders and General Meetings
Shareholders exercise their influence at the General Meetings, the
Company’s highest decision-making body. The Annual General
Meeting is held within six months after the end of the financial year.
Decisions made by shareholders’ at the General Meetings include (i)
adoption of instructions for the Nomination Committee which nomi -
nates members to the Company’s Board of Directors, (ii) determina -
tion of the number of Board members, composition of the Board
(including the Chairperson of the Board) and remuneration of Board
members, based on recommendations by the Nomination Commit -
tee, (iii) election of external auditors, (iv) determination of the distri -
bution of dividends, (v) confirmation of income statements and bal -
ance sheets and the disposition of the Company’s profit or loss, (vi)
discharge from liability of the Board of Directors and CEO; and (vii)
adoption of guidelines for remuneration to the CEO and other mem -
bers of the EMT. In addition, the shareholders of the Company can
resolve on other significant matters at the General Meeting, such as
amendments to the Articles of Association.
In addition to the Annual General Meeting, Extraordinary General
Meetings can be convened when required. Notice of the Annual
General Meeting, as well as an Extraordinary General Meeting at
which the matter of amendment to the Articles of Association is to
be addressed, shall be issued not earlier than six weeks and not later
than four weeks prior to the General Meeting. Notices of other
Extraordinary General Meetings shall be issued not earlier than six
weeks and not later than three weeks prior to the Extraordinary
General Meeting. Notice of General Meetings shall be published in
the Swedish Official Gazette (Sw. Post- och Inrikes Tidningar) and
on the Company’s website. Simultaneously, an announcement with
information that the notice has been issued shall be published in
Dagens Industri.
Right to attend General Meetings
All shareholders who are directly recorded in the Company’s share
register maintained by Euroclear Sweden six banking days prior to
the General Meeting and who have notified the Company of their
intention to participate in the General Meeting no later than the date
indicated in the notice of the General Meeting, are entitled to attend
the General Meeting and vote for the number of shares they hold.
In addition to notifying the Company, shareholders whose shares
are nominee registered through a bank or other nominee must
request that their shares are temporarily registered in their own
names in the register of shareholders maintained by Euroclear
Sweden, in order to be entitled to participate in the General Meeting.
Shareholders should inform their nominees well in advance of the
record date. Voting registrations made by nominees not later than
four banking days prior to the General Meeting will be taken into
account.
Shareholders may attend the Company’s General Meetings in
person or by proxy and may be accompanied by a maximum of two
assistants. It will normally be possible for shareholders to register
for the General Meeting in several different ways, as indicated in the
notice of the meeting.
Shareholder initiatives
Any shareholder of the Company who wishes to have a matter
addressed at a General Meeting must submit a written request to
the Board of Directors. The matter will be addressed at a General
Meeting if the request has been received by the Company no later
than seven weeks prior to the General Meeting, or after such date,
if it still is in due time for the matter to be included in the notice of
the General Meeting.
Number of shareholders and ownership structure
The total number of shares in Volvo Car AB (publ.) amounts to
2,979,524,179 shares of series B which are listed on the Nasdaq
Stockholm Stock Exchange. Per 16 February 2026, Volvo Cars larg-
est shareholder is Geely Sweden Holdings AB holding approximately
78.65 per cent of the total number of shares and votes in the Com -
pany. In addition, per the same date, Geely International Hong Kong
Limited holds approximately 0.22 per cent of the total number of
shares and votes in the Company. The remaining 21.13 per cent of the
shares and votes are held by Nordic and international investors and
approximately 153,000 other investors. For further information on
the ownership structure, please refer to page 220.
Volvo Cars held 14,894,838 own shares as per 31 December 2025.
Nomination Committee
Under the Code, a company listed on Nasdaq Stockholm shall have a
Nomination Committee, the purpose of which is to make proposals to
the General Meeting in respect of the Chairperson of General Meet -
ings, number of Board members, elections of Board members, Chair -
person of the Board and auditor, remuneration of each Board mem -
ber (divided between the Chairperson of the Board and other Board
members, and remuneration for committee work), remuneration to
the auditor, and to the extent deemed necessary, proposals for
amendments to the instruction for the Nomination Committee.
At the Annual General Meeting held on 17 October 2021, the cur -
rent instruction for the Nomination Committee was adopted to apply
until further notice.
The Nomination Committee prior to the Annual General Meeting
2026 consists of representatives of the three largest shareholders in
terms of voting rights, as of 29 August 2025, and as announced on
10 September 2025. Members of the Nomination Committee are:
• Lone Fønss Schrøder, appointed by Geely Sweden Holdings AB,
Chairperson of the Nomination Committee
• Per Ansgar, appointed by Geely Sweden Holdings AB
• Eric Li (Li Shufu), Chairperson of the Board of Volvo Car AB (publ.)
• Anders Oscarsson, appointed by AMF
• Emilie Westholm, appointed by Folksam
The Nomination Committee applies a framework for nomination of
members to the Board, which stipulates that the composition of the
Board shall be diverse in terms of gender, nationality, professional
background and key competences e.g. sustainability, relevant trans -
formation areas and new technology. This is to ensure that the Board
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE
44
===== SIDA 45 =====
has the appropriate balance of expert knowledge, which matches the
scale and complexity of Volvo Cars, supports sustainable develop -
ment and meets the independency requirements of Volvo Cars. Volvo
Cars’ aim is to have a balanced composition in terms of gender and it
is the ambition that each gender shall have a share of at least some
40 per cent of the Board members elected by the shareholders’
meeting. This ambition was achieved in the Annual General Meetings
2023, 2024 and 2025, whereafter the two latter years 44 per cent of
the Board members elected by the shareholders were women. Fol -
lowing Lone Fønss Schrøder’s decision to step down from the Board
in June 2025, 37.5 per cent of the Board members elected by the
shareholders were women. Following the Extraordinary General
Meeting held on 8 December 2025, 40 per cent of the Board
members elected by the shareholders are women. The Unions repre -
sented in the Board shall be encouraged to apply the corresponding
ambition when appointing their representatives.
Board of Directors
The Board of Directors, which is the highest decision-making body
after the General Meeting, bears ultimate responsibility for Volvo Car
Group’s organisation, management and control of Volvo Car Group’s
financial conditions. The Board of Directors shall further ensure that
the Company applies the Code and complies with applicable laws
and regulations, Nasdaq Stockholm’s rulebook for issuers, the listing
rules of the Luxembourg Stock Exchange’s Euro MTF market, the
Company’s Articles of Association and the rules of procedures for
the Board.
Composition
At all times, the Board shall consist of a minimum of three and a max -
imum of twelve members and in addition thereto the number of
employee representatives as required under Swedish law. No mem -
ber of the EMT other than the CEO shall be a member of the Board.
Each new Board member is provided with an introduction programme
to learn about Volvo Car Group and its regulatory requirements. It is
furthermore the Board’s intention, during normal conditions, to visit
a Volvo Car Group site other than the headquarters at least once a
year.
In accordance with the Code, the rules of procedures for the Board
stipulate that the majority of the Board members elected by the
General Meeting shall be independent of the Company and the EMT
and at least two of these independent members shall also be inde -
pendent of major shareholders. In order to determine whether a
member of the Board is independent in relation to the Company and
the EMT, an overall assessment must be made of all circumstances
which might give reason to question the independence of the Board
member, e.g. the Board member’s current or previous employment,
other board memberships or other relationships. Furthermore, in
order to determine the independence in relation to major sharehold -
ers, consideration must be given to the scope of the Board member’s
direct or indirect relationship to the Company’s major shareholders.
Pursuant to the Code, “major shareholder” means a shareholder who,
directly or indirectly, controls 10 per cent or more of the shares or
voting rights in the Company. The Nomination Committee’s assess -
ment of the independence of the Board members in relation to the
Company, the EMT and major shareholders is presented below.
Daniel Li (Li Donghui), Anna Mossberg, Jonas Samuelson, Lila
Tretikov, Diarmuid O’Connell, Ruby Lu (Rong Lu), Pieter Nota and
Caroline Grégoire Sainte Marie are deemed independent in relation
to the Company and the EMT, and, among these members, Anna
Mossberg, Jonas Samuelson, Lila Tretikov, Diarmuid O’Connell, Ruby
Lu (Rong Lu), Pieter Nota and Caroline Grégoire Sainte Marie are also
deemed independent in relation to major shareholders. The Company
thereby satisfies the Code’s independence requirement.
Name of the Board members
Independent of
the company/senior
management
Independent of
the company’s
major shareholders
Board meeting
attendance
Committee
meeting
attendance
Remuneration,
Board and
Committees 1), SEK
Members elected by the Shareholders’ Meeting
Eric Li (Li Shufu) (Chairperson of the Board) N N 12/15 N/A N/A
Lone Fønss Schrøder (Vice Chairperson of the
Board) 2) Y N3) 9/9 6/6 3,310,000
Jim Rowan4) N Y 4/5 2/2 N/A
Håkan Samuelsson 5) N Y 10/10 1/1 N/A
Daniel Li (Li Donghui) Y N 14/15 10/13 N/A
Jonas Samuelson Y Y 15/15 10/10 1,855,0006)
Diarmuid O’Connell Y Y 15/15 6/7 1,345,000
Lila Tretikov Y Y 15/15 9/10 1,420,000
Anna Mossberg Y Y 13/15 N/A 1,200,000
Ruby Lu (Rong Lu) Y Y 12/15 2/3 1,420,0007)
Pieter Nota8) Y Y 1/1 N/A 1,200,000
Caroline Grégoire Sainte Marie 8) Y Y 1/1 N/A 1,420,0009)
1) Annual average remuneration of the Board and Committees as adopted by the Annual General Meeting in April 2025.
2) Lone Fønss Schrøder left the Board on 26 June 2025. Remuneration includes annual average remuneration as vice chairperson of the Board and chair -
person of the Audit Committee.
3) Since 2019, Lone Fønss Schrøder was a director in the board of Geely Sweden Holdings AB, the main owner of Volvo Cars.
4) Jim Rowan left the Board on 31 March 2025.
5) Håkan Samuelsson joined the Board at the Annual General Meeting on 3 April 2025.
6) Jonas Samuelson was appointed as chairperson of the Audit Committee on 16 July 2025, remuneration therefore includes annual average remuneration
as chairperson of the Audit Committee.
7) Ruby Lu was a member of the China Committee until it was dissolved in September 2025, remuneration therefore includes annual average remuneration
for membership in the China Committee.
8) Appointed at the Extraordinary General Meeting held on 8 December 2025.
9) Caroline Grégoire Sainte Marie was appointed as member of the Audit Committee on 9 December 2025, remuneration therefore includes annual average
remuneration for membership in the Audit Committee.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE
45
===== SIDA 46 =====
Conflicts of interest
Board members shall inform the Chairperson and/or the Vice Chair -
person (if appointed) immediately if they find themselves in a con -
flict-of-interest situation. A Board member with a conflict of interest
in relation to any matter to be dealt with by the Board may not par -
ticipate in the discussions (unless there are specific circumstances)
or decisions regarding such matter. As an example, Eric Li (Li Shufu)
and Daniel Li (Li Donghui), are not involved in any decision regarding
Geely Holding Group entities and Lone Fønss Schrøder was not
involved in any such decisions during her time as Board member. In
addition, as an additional governance measure in relation to conflicts
of interest, all related party transactions are handled by a specific
department within Volvo Car Group, called Collaborations.
Matters for the Board
The Board is responsible for the organisation of Volvo Car Group and
the management of its business worldwide. The Board continuously
monitors Volvo Car Group’s performance, evaluates Volvo Car
Group’s strategic direction and business plan as well as other
aspects such as adherence to its Code of Conduct. Certain matters
are delegated to the Board’s Committees or the CEO as set out in the
rules of procedures for the Board.
Sustainability is a deeply integrated part of Volvo Car Group’s
strategy and the Board monitors Volvo Car Group’s efforts in reach-
ing the ambitions set, and sustainability related risks and opportuni -
ties. Further information regarding Volvo Cars’ governance of
sustainability related matters is described in the Sustainability
Statement on page 140.
To ensure that the Board has good visibility of the Group’s opera -
tions, the President and CEO of the Volvo Car Group submits a report
on the business, including reporting from the Group’s strategic affili -
ates, where appropriate, at all Board meetings. The Chief Financial
Officer also reports on the financials of Volvo Car Group, including
relevant matters relating to e.g. treasury and hedging. The Board is
also provided with updates and reports on other relevant topics such
as risk management, disclosure matters etc., as appropriate. In addi -
tion, the Board discusses specific strategic topics of relevance, and
the Board Committees report on their work. At each Board meeting,
a number of decision items are also presented for the Board’s
consideration and decision in accordance with the Board’s rules of
procedure.
The work of the Board follows an annual cycle to allow the Board
to address matters within the scope of its responsibility on a yearly
basis. Matters that come up regularly include product and commer -
cial strategy and business opportunities within new technology and
digitalisation as well as sustainability and compliance.
Authorisation for the Board to resolve on new issues
of shares
At the Annual General Meeting held on 3 April 2025, the sharehold -
ers resolved to authorise the Board to, on one or several occasions,
up to the next Annual General Meeting, with or without deviation
from the shareholders’ preferential right, resolve on new issues of
shares of series B and/or subscription warrants and/or convertible
bonds. The total number of shares that may be issued by way of a
new share issue, exercise of subscription warrants or conversion of
convertible bonds, by virtue of the authorisation shall be within the
limits of the articles of association and not exceed ten per cent of the
total number of shares in the Company at the time of the Board’s
resolution. The authorisation includes a right to resolve on new
issues for cash consideration, by contribution in kind or payment by
set-off. The issue price shall, in case of deviation from the sharehold -
ers’ preferential right, be determined in accordance with market
price. The Board shall be entitled to determine other terms of the
issue.
The purpose of the authorisation, and the reason for any deviation
from the shareholders’ preferential right, is to increase the financial
flexibility of the Company to enable the Company to finance the
operations in a fast and efficient way, acquire companies, businesses
or parts thereof and/ or to enable a broadening of the ownership of
the Company.
Authorisation for the Board to resolve on acquisition
of own shares
At the Annual General Meeting held on 3 April 2025, the sharehold -
ers resolved to authorise the Board to resolve on acquisition of own
shares of series B on Nasdaq Stockholm to secure Volvo Cars’ obli-
gations to deliver shares to the participants in the Company’s
employee share incentive plans; the Employee Share Matching Plan
adopted by the Annual General Meeting during 2024 and the Perfor -
mance Share Plans adopted by the Annual General Meetings during
2023, 2024 and 2025 (the “PSP” and “ESMP” respectively or jointly
the “Plans”). Acquisition of own shares of series B may only be
effected on Nasdaq Stockholm. A maximum of 53,441,495 shares of
series B in Volvo Cars may be acquired to secure delivery of shares to
the participants under the Plans, of which 9,886,909 shares relate to
PSP 2023, 12,539,648 shares relate to PSP 2024, 16,578,427 relate
to ESMP 2024 and 14,436,511 relate to PSP 2025. Acquisitions of
shares of series B in Volvo Cars on Nasdaq Stockholm may only be
made at a price within the price range (spread) on Nasdaq Stockholm
applicable from time to time, meaning the spread between the high -
est purchase price and the lowest selling price prevailing and dis -
seminated by Nasdaq Stockholm from time to time. The authorisa -
tion may be utilised on one or several occasions, however, only until
the Annual General Meeting 2026.
On 19 May 2025, the Board resolved to repurchase own shares in
accordance with the authorisation to secure the future delivery of
shares to participants in the PSP adopted by the Annual General
Meeting in 2023, 2024 and 2024 and the ESMP plan adopted by the
Annual General Meeting in 2024. Pursuant to the repurchase pro -
gramme, 12,500,000 shares of series B were repurchased during the
period between 20 May and 19 June 2025, for a total amount of SEK
218,866,471. All acquisitions were made on Nasdaq Stockholm by
Skandinaviska Enskilda Banken AB (publ) on behalf of the Company.
Board meetings
In accordance with the rules of procedures for the Board, the Board
is expected to meet six to ten times per year at venues to be agreed
by the Board. The Board has held 15 meetings during 2025, of which
ten were ordinary and five extraordinary. The Board meets the exter -
nal auditor at least once a year without the CEO or any other member
of the EMT present. In addition, the Board occasionally holds
non-executive meetings. The General Counsel and Chief Corporate
Affairs Officer is the secretary of the Board and also attends Board
meetings as does the Chief Financial Officer.
The table on page 45 shows the Board members’ attendance to
the Board meetings in addition to their independence according to
the requirements of the Code in relation to (i) the Company and (ii)
the major shareholder, and the remuneration to the Board members
for Board and Committee work.
Evaluation of the work of the Board
The Board, through an external provider, conducts an annual survey
of its work performed during the year. The survey covers areas such
as the climate at Board meetings, the allocation of time spent on
different topics, the work of the Board and its committees, the effi -
ciency of the work of the Board, their prerequisites to perform Board
work, Board leadership and relations with the EMT. Based on the
result of the survey the Board will be benchmarked against its peers.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE
46
===== SIDA 47 =====
The Board is also evaluated on performance and composition and
possible areas of improvement are identified. Relevant parts of the
survey are also used in the Nomination Committee process. In addi -
tion to the annual survey, the Nomination Committee also conducts
meetings with each individual Board member during the year to dis -
cuss the Board work as part of the Nomination Committee process.
Board committees
According to the Swedish Companies Act and the Code, the Board
of Directors shall institute an Audit Committee and a Remuneration
Committee. The members of the Remuneration Committee are to be
independent of the Company and the EMT. A majority of the Audit
Committee’s members are to be independent in relation to the
Company and its EMT and at least one of the members who is inde -
pendent in relation to the Company and the EMT is also to be inde -
pendent in relation to the Company’s major shareholders. At least
one member of the Audit Committee must also have accounting or
auditing proficiency. The Board has established two permanent
committees, the Audit Committee and the People Committee (which
fulfils the tasks of the Remuneration Committee pursuant to the
Code). In addition to these, the Board established a temporary China
Committee during 2023. In September 2025, the Board decided to
discontinue the China Committee.
The major tasks of these committees are of preparatory and
advisory nature, but the Board of Directors may also delegate deci -
sion-making powers on specific issues to the committees. The issues
considered at committee meetings shall be recorded in minutes of
the meetings and continuously reported to the Board. The commit -
tees are appointed at the statutory Board meeting following election
of Board members. The Board has also determined that issues may
be referred to ad hoc committees dealing with specific matters.
Audit Committee
The Board has assigned an Audit Committee to oversee corporate
governance, financial and sustainability reporting, the internal
control system, risk management and compliance with external and
internal regulations.
The Audit Committee is responsible for identifying and reporting
relevant issues to the Board within the Audit Committee’s areas of
responsibility. The Audit Committees tasks are to monitor the integ -
rity of Volvo Car Group’s financial and sustainability reporting sys -
tem, internal controls, related-party transactions, operation proce -
dure and the enterprise risk management framework, recommend to
the Board the appointment, removal and remuneration of the exter -
nal auditors (subject to approval at the shareholders’ meeting) in
accordance with the Swedish Companies Act, monitor the independ -
ence of the external auditors and review the effectiveness of the
Internal Audit and the Compliance and Ethics Program. The external
auditors participate in parts of the Audit Committee meetings. The
Audit Committee has during the year met with the external auditors,
without management present, to discuss management matters and
related topics. The Internal Audit function reports directly to the
Audit Committee and the Compliance and Ethics Office has direct
access to the Audit Committee for escalation. The Audit Committee
has held ten meetings during 2025, of which six were review meet -
ings of quarterly reports or annual report meetings. Jonas Samuel -
son (chairperson), Daniel Li (Li Donghui) and Lila Tretikov are the
current members of the Audit Committee. Lone Fønss Schrøder was
a member and chairperson of the Audit Committee until she left
the Board in June 2025 . The Audit Committee complies with the
Swedish Companies Act’s and the Code’s requirements for inde -
pendence as well as accounting and audit competence.
People Committee
The Board has assigned to the People Committee to prepare the
remuneration guidelines for the CEO and the EMT members. Further -
more, the committee supports the Chairperson or Vice Chairperson
of the Board (when appointed), as applicable, with the approval of
remuneration and benefits of the CEO and is responsible for prepar -
ing the remuneration report to be presented at the Annual General
Meeting for its approval, and in dialogue with the CEO, assist with or
resolve on various other people and remuneration matters in relation
to the EMT. The committee is also responsible for approval and mon -
itoring of the global incentive arrangements for the EMT and other
key employees and necessary coordination of such incentives and
the Volvo bonus to all employees, succession planning for the CEO in
dialogue with the Chairperson or the Vice Chairperson of the Board
(when appointed), as applicable, as well as other EMT positions. The
committee also approves the EMT members’ engagements outside
Volvo Car Group. The People Committee has held seven meetings,
whereof five ordinary meetings and two extra meetings during 2025.
Jonas Samuelson (Chairperson) and Diarmuid O’Connell are the
current members of the People Committee. The People Committee
complies with the Code’s requirements for independence.
China Committee
In September 2023, the Board decided to incorporate a new tempo -
rary China Committee which was to be evaluated after one year. In
December 2024, the Board decided to prolong the term of the
committee with one additional year and in September 2025 the
Board decided to discontinue the China Committee. The China Com -
mittee has, until September 2025, prepared and reviewed matters on
behalf of the Board regarding the strategic direction and develop -
ment of Volvo Cars’ business in China. The China Committee held
three ordinary meetings during 2025. Ruby Lu and Daniel Li (Li Don -
ghui) were members of the Committee during the year together with
Jim Rowan (Chairperson) until 31 March 2025 and Håkan Samuels -
son (Chairperson) from 3 April 2025.
Governance and compliance functions and forum
In order to ensure a safe and stable governance of its work, the Board
has three functions that directly reports, or provides regular updates
to the Board or its committees: the Global Audit Office, the Compli -
ance and Ethics Office and Internal Control. The Disclosure Commit -
tee is a governance compliance forum that also reports to the Board.
In addition, the external auditors are working independently from
the Board’s functions. In addition to the above-mentioned govern -
ance and compliance functions and forums, the EMT has also estab -
lished three decision foras, consisting of members of the EMT and
other senior company representatives: the Corporate Board, the
Product Board and the Digital Board. Information on the purpose of
these boards are set out under “CEO and Executive Management
Team” on page 50 below.
Global Audit Office
Volvo Car Group has an independent Internal Audit function referred
to as the Global Audit Office with the assignment to determine
whether Volvo Car Group’s governance, internal control and risk
management processes, as designed, operated and represented by
management, are adequate and effective. The scope of the internal
audit is determined by means of a risk assessment process and any
additional requirements by the Board. The Audit Committee
approves the internal audit plan which includes risks associated with
the execution of the corporate strategy, execution of transformation,
sustainability, business operations and processes. Audit results and
status of implemented corrective measures by management are
reported to the Audit Committee and internal audit results of
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE
47
===== SIDA 48 =====
significance will also be reported to the Board. The Head of the
Global Audit Office reports to the Audit Committee.
Disclosure Committee
Volvo Car Group has listed shares on Nasdaq Stockholm and listed
bonds on Luxembourg Stock Exchange and is therefore required to
comply with the relevant disclosure obligations under the Market
Abuse Regulation (MAR), as well as under the listing rules of the
Luxembourg Stock Exchange’s Euro MTF market and the Nasdaq
rulebook for issuers. In order to ensure compliance with the relevant
requirements, Volvo Car Group has established a Disclosure Com -
mittee and the Board of Directors has adopted a set of procedures
for the Disclosure Committee. The Board and the Audit Committee
are kept updated on the discussions and decisions of the Disclosure
Committee by means of summary reports and access to the minutes
kept at the committee meetings. The members of the Disclosure
Committee are the General Counsel and Chief Corporate Affairs
Officer (Chairperson), the Chief Financial Officer, the Head of Treas -
ury and Strategic Finance and the Head of Communications. In addi -
tion, the Head of Corporate Governance participates in the meetings
as secretary and the Head of Corporate Governance Office may par -
ticipate as deputy secretary. The Head of Accounting and Group
Reporting is a required participant in financial result review meet -
ings, and other senior company representatives attend the meetings
on an agenda-driven basis. The Disclosure Committee has been
established to implement required disclosure controls and proce -
dures, resolve whether or not information is to be categorised as
inside information or not and consider whether there is reason to
delay disclosure of inside information or whether disclosure as soon
as possible is required as well as determine whether the require -
ments for selective disclosure are fulfilled.
Compliance and Ethics
Volvo Cars has a Compliance & Ethics Office to support Volvo Cars in
conducting its business responsibly, ethically and in accordance with
all relevant laws and regulations and Volvo Cars Code of Conduct. To
define the overarching role, authority, independence and oversight of
the Compliance & Ethics Office and to support the Board of Direc -
tors’ responsibility in overseeing the Compliance & Ethics Program,
the Board of Directors has implemented a Compliance & Ethics
Charter (the “Charter”) and, to support Volvo Cars’ regionalisation
efforts (see further information on page 50 below), a supplementary
China Compliance & Ethics Charter (the “China Charter” and jointly,
the “Charters”).
The Compliance & Ethics Office is led by the Global Head of
Compliance & Ethics, who serves as the Chief Compliance & Ethics
Officer for Volvo Car Group. The Global Head of Compliance & Ethics
reports to the General Counsel and Chief Corporate Affairs Officer
and, to ensure independence, also has direct access to, and regularly
reports, to the Audit Committee. The Global Head of Compliance &
Ethics also ensures that compliance training is provided to the Board
of Directors.
The Compliance & Ethics Program covers the designated compli -
ance risk areas for Volvo Cars, which currently are (i) anti-corruption
and bribery (incl. conflicts of interest), (ii) trade sanctions and export
control, (iii) data protection (including privacy and AI compliance
governance), (iv) human rights, and (v) competition law. Product
compliance matters lie outside the scope of the Compliance & Ethics
Office and are the responsibility of the Chief Strategy and Product
Officer.
To ensure top-level support and direction for the Compliance &
Ethics Program and promote open communication between the
Compliance & Ethics Office and the members of the EMT, the Board
has further, through the Charter established a Compliance Commit -
tee. The Compliance Committee serves as the primary governance
body for compliance and ethics matters at group level, supporting
effective implementation, oversight, and continuous improvement of
the Compliance & Ethics Program globally. It is chaired by the Gen -
eral Counsel and Chief Corporate Affairs Officer and consists of the
entire EMT. The Global Head of Compliance & Ethics and the Head of
Global Audit Office are also attendees. In addition, other individuals
may be directed to provide information and attend committee meet -
ings as needed based on the nature of specific agenda items or
emerging risks.
The Compliance Committee is provided with regular updates from
the Compliance & Ethics Office, while detailed reviews and decisions
on regular compliance cases reported by the Compliance & Ethics
Office are delegated to the General Counsel and Chief Corporate
Affairs Officer and the Chief People Officer. Furthermore, the Com -
pliance Committee reviews compliance-related matters reported by
the Internal Audit and Internal Control functions, respectively, when
appropriate. The Compliance Committee normally meets four times
per year and ad hoc meetings may be called for if and when required.
In addition, in the regionalisation set-up process (described on page
50), a China Compliance Committee has been established to serve as
a governance body supporting effective implementation, oversight,
and continuous improvement of the Compliance & Ethics Program in
China. The China Compliance Committee is chaired by the General
Counsel and Chief Corporate Affairs Officer and further consists of
the President of Greater China, the Head of China Compliance &
Ethics and the General Counsel for Geely Group. It may also appoint
ad hoc members as needed based on the nature of specific agenda
items or emerging risks, e.g. the Global Head of Compliance & Ethics,
heads of management responsible for the relevant item or risk and
the Head of Internal Audit (APAC).
Volvo Car Group’s Code of Conduct reflects Volvo Car Group’s val-
ues and culture and how it drives results in an ethical and responsible
way by placing the emphasis on Volvo Car Group’s culture, values and
commitments in addition to focusing on the requirements set out in
Volvo Car Group’s corporate policies. The Compliance & Ethics
Office supports the business operations in conducting business in a
responsible and ethical manner, by designing, overseeing and moni -
toring the development, implementation and maintenance of the
Compliance and Ethics Program. The program consists of ten pro -
gram elements designed on the basis of guidelines for “effective
compliance program” and “adequate procedures”, such as the US
Sentencing Guidelines and the UK Bribery Act Guidance (supporting
the Foreign Corrupt Practices Act and the UK Bribery Act respec -
tively), as well as guidance from European Anti-Trust Offices. In addi -
tion to the Compliance & Ethics organisation described above, the
program elements include: tone from the top and culture; risk
assessment; a Compliance & Ethics framework (Code of Conduct and
corporate policies, directives and guidelines); training, awareness
and communication; due care; internal reporting and investigations;
enforcing disciplinary actions and incentives; monitoring and audit;
program assessment and continuous improvement. The Compliance
& Ethics Office provides training regarding the Code of Conduct and
the five main compliance and ethics risk areas as stated above,
including on whistleblowing and how to raise concerns using the Tell
Us reporting line. More information about the performance of the
Compliance & Ethics Program, and the risk areas it covers, is availa -
ble on page 48.
In addition to the areas covered by the Compliance & Ethics
Program, and though Volvo Car Group is generally not subject to
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE
48
===== SIDA 49 =====
anti-money laundering laws and regulations for financial institutions,
there are measures in place to combat money laundering and terror -
ist financing, overseen by Group Treasury
Internal control
The Board takes the responsibility for ensuring an effective internal
control system exists within the Group; this is in line with the require -
ments of the Swedish Companies Act and Swedish Corporate
Governance Code.
Volvo Car Group has an internal control function which supports
the Board and the EMT in execution of their internal control respon -
sibilities. The purpose of the internal control function is to support in
defining effective and efficient internal controls to adequately
ensure compliance with external and internal requirements (policies,
directives and guidelines) for financial reporting, digital environment,
sustainability reporting (read along with the Sustainability State -
ment, starting page 130) and other relevant reporting to the Board.
The Internal Control function regularly reports to the Audit Commit -
tee on a periodic basis which includes topics including but not limited
to internal control risks, scope, plan and status updates.
Volvo Car Group uses the principles laid out by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO)
framework to set its own Internal Control framework which is
explained further into; (a) Control Environment, (b) Risk Assessment,
(c) Control Activities, (d) Information and Communication and (e)
Monitoring.
(a) Control Environment
The foundation of Volvo Car Group’s control environment originates
from the Volvo Car Group’s strategic direction (as further elaborated
on page 21) which creates the appropriate culture within the Volvo
Car Group and provides a clear tone from the top. Our values, which
derive from our Code of Conduct, provide the guiding principles to
define our corporate policies, directives and guidelines.
The foundation of internal controls is based upon our policies,
directives and guidelines which also define our responsibility and
authority structure.
(b) Risk Assessment
Volvo Car Group has a dynamic and iterative risk assessment process
to identify and assess risks which affect achievement of our objec -
tives.
Risk assessment starts at the enterprise risk level which is managed
by the Enterprise Risk Management (“ERM”) function and elaborated
further in the Risk section of the Annual Report, on pages 37–41.
Risk assessment over the Internal Control environment is per -
formed at least once every year using different sources, including but
not limited to; continuous dialogues with management, assess the
impact of enterprise risks, assessment of the annual group financial
statements, assessing risks relating to controls over sustainability
reporting, assess any impact on controls due to internal require -
ments (policies and directives defined by different functions), assess
any impact on controls due to external requirements and assess
impact of any control issues identified. Summary of the relevant risks
is reported to Audit Committee at least once every year.
(c) Control activities
Control activities are the actions established which help to address
risks and implement the internal and external requirements to ensure
the achievement of objectives. Control activities help to ensure that
potential risks are prevented or detected and corrected. Control
activities are defined throughout the organisation to manage risks,
and these control activities are maintained in our internal control
frameworks. While the controls are defined in the frameworks which
are maintained by the Internal Control function, the control owner -
ship for each control is spread across the organisation and the
framework points at the job role within the organisation who is the
control owner for each control. Further, it is analysed iteratively for
need to update any controls activities or define controls activities in
new areas of risks. Internal Control frameworks are reviewed at least
once every year.
(d) Information and Communication
Information is necessary to enable the personnel to carry out their
responsibility to support the achievements of objectives while com -
munication helps to iteratively provide, share and obtain information.
Volvo Car Group’s policies, directives and guidelines are updated
and communicated on a regular basis by the responsible policy
owners and maintained in the central repository. The respective
functions in the Volvo Car Group takes the operating responsibility to
ensure that these policies, directives and guidelines are included in
their daily operations.
Internal Control related information is maintained on various
platforms, including the directives, internal SharePoint and GRC
(Governance, Risk and Compliance) tool. Further, there are various
forms of communication to provide, share and obtain information
around internal controls like; continuous communication channels
with key stakeholders, learning and trainings provided, newsletters
shared and the internal SharePoint for internal controls.
(e) Monitoring
Regular or specific evaluations are performed to ensure risks are
being appropriately addressed by verifying that the organisation is
performing the controls as defined in the control frameworks. These
evaluations can be in the form of self-assessments or independent
reviews or a combination thereof, performed by the Internal Control
team. The method used for monitoring of controls is determined based
on factors such as the assessed level of risk associated and suitability
to the purpose of monitoring. Results from monitoring activities are
reported at least once every year to the Audit Committee.
Issue process is defined to ensure any control issues / risks are
recorded, analysed, actioned and resolved. These control issues or
risks can be noted through multiple sources like monitoring proce -
dures or self-identified risk by operations or risks identified by inter -
nal or external auditors.
External auditors
The Company’s auditors are appointed by the Annual General Meet -
ing. At the Annual General Meeting held on 3 April 2025, Deloitte AB
was re-elected until the next Annual General Meeting as the Compa -
ny’s auditor. Fredrik Jonsson is the auditor in charge.
The external auditors discuss the external audit plan, audit find -
ings and risk management with the Audit Committee. The auditor
reviews one interim report per year and presents the results of its
work to Audit Committee. The auditor also examines the Corporate
Governance Report and provide a limited assurance of the Sustaina -
bility Report and the Green Financing Report. The results of its finan -
cial year audit and the audit of the Annual Report of the parent com -
pany and the consolidated financial statements are presented to the
Audit Committee and the Board of Directors at meetings after year
end. An opinion regarding the compliance with the guidelines for
executive remuneration is made in conjunction with the Annual Gen -
eral Meeting. When Deloitte is asked to provide services other than
the external audit, this is done in accordance with general independ -
ence rules. Deloitte provides an annual written assurance of its
impartiality and independence to the Audit Committee in accord -
ance with the Swedish Companies Act and ISA 260.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE
49
===== SIDA 50 =====
CEO and the Executive Management Team
The division of work between the Board and the CEO is set out in the
rules of procedures for the Board and follows the Swedish Compa -
nies Act. The CEO is responsible for Volvo Car Group’s everyday
management and operations and for the preparation of reports and
compiling information for the Board meetings and for presenting
such material at the Board meetings.
The CEO is further responsible for Volvo Car Group’s financial
reporting and consequently must ensure that the Board receives
adequate information for the Board to be able to evaluate the
Group’s financial condition. The CEO regularly keeps the Board
informed of the developments in Volvo Car Group’s operations, the
development of sales, Volvo Car Group’s results and financial posi -
tion, important business events and all other events, circumstances
or conditions which can be assumed to be of significance to Volvo
Car Group’s shareholders.
The CEO leads the work of the EMT, which is responsible for the
overall business development and operations of Volvo Car Group. In
addition to the CEO, the EMT consists of the Chief Financial Officer,
the General Counsel and Chief Corporate Affairs Officer, the Chief
People Officer, the Chief Commercial Officer, the Chief Strategy &
Product Officer, the Chief Industrial Operations Officer, the Chief
Engineering & Technology Officer and the Chief Design Officer. The
EMT’s role is to assist the CEO in the operation of Volvo Car Group’s
business, set the strategic long-term direction in dialogue with the
Board and take corporate and strategic decisions as delegated by the
Board. The strategic direction is supported by functional strategies
that guide the Company’s priorities. In order to assist the EMT in car -
rying out decisions and actions related to certain topics to fulfil the
Group’s strategic direction as further elaborated on page 21, the CEO
has established the Extended Executive Management Team (EMTe)
which in addition to the EMT includes a number of other senior
management positions within Volvo Car Group. The EMTe shall have
shorter term tactical focus and support EMT to drive performance
and execution based on direction set by EMT.
The EMT and EMTe’s work includes three operational fora; the Prod -
uct Board, the Corporate Board and the Digital Board, covering
cross-functional topics related to the product portfolio, corporate
matters and projects and the digital landscape, respectively, which
supports the EMT to provide guidance, deliver strategic directions
and approve decisions within its respective responsibilities. The EMT
meets on a weekly basis and the whole EMTe meets bi-weekly.
Regionalisation
Volvo Car Group has during 2025, with the support from the Board,
started a regionalisation strategy, to empower Volvo Cars regions by
providing them with greater operational autonomy. For the China
region specifically, the operations are run through the existing
company Daqing Volvo Car Manufacturing Co., Ltd. (“Daqing Joint
Venture”), being a 50/50 joint venture between Volvo Car Group and
Zhejiang Geely Holding Group Ltd and consolidated into Volvo Car
Group. The board of the Daqing Joint Venture has been strength -
ened to include Håkan Samuelsson (as director and chairperson),
Ruby (Rong) Lu and Geert Bruyneel as Volvo Car Group representa-
tives and Daniel (Donghui) Li together with An Conghui as Zhejiang
Geely Holding Group Ltd representatives. The governance of the
Daqing Joint Venture is built to apply Volvo Car Group’s Code of
Conduct and following Volvo Car Group’s policies and directives and
leveraging on Zhejiang Geely Holding Group Ltd’s knowledge of the
Chinese market.
From a corporate governance perspective, the responsibility for
Volvo Car Group remains with the Board for all consolidated entities,
including the Daqing Joint Venture. Other than the establishment of
the additional China Compliance Committee in order to strengthen
the Compliance & Ethics Function in the China region, Volvo Car
Group’s regionalisation efforts do not affect the corporate govern -
ance structure set out in this report.
Gothenburg 4 March 2026
Volvo Car AB (publ.)
Board of Directors
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE
50
===== SIDA 51 =====
ERIC LI (LI SHUFU) HÅKAN SAMUELSSON
CHAIRPERSON AND MEMBER OF THE BOARD
Born 1963.
Chairperson and member of the Board since 2010.
Education: Bachelor’s Degree in Management Engineering from the Harbin
University of Science and Technology, China. Master’s Degree in Mechanical
Engineering from the Yanshan University, China.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Founder of Zhejiang Geely Holding Group Co. Ltd, Ecarx
Holdings Inc and PSD Capital Limited (indirect shareholder in Polestar).
Chairman of the Board of Zhejiang Geely Holding Group Co. Ltd, Geely
Technology Group Co. Ltd, Geely Talents Development Group Co. Ltd, PSD
Capital Limited and PSD Investment Limited, and smart Automobile Co. Ltd.
Member of the Board of Geely Group Limited, and Geely Sweden Holdings
AB and a number of other companies within his ownership.
Professional experience: Former CEO of Zhejiang Geely Holding Group Co.
Ltd.
Holdings in Volvo Car AB (publ.), own and related parties: 2,349,935,270
B shares.1) 2)
Not independent in relation to the company and Executive Management
Team nor the Company’s major shareholders.
BOARD MEMBER, PRESIDENT AND CEO
Born 1951.
Member of the board since 2025
Education: Master of Science in Mechanical Engineering from KTH Royal
Institute of Technology, Sweden.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Board member in ABB E-Mobility, Modular Management
Group Stockholm AB and Business Sweden.
Professional experience: Former CEO of MAN AG. Previous experience
from executive management (EVP) at Scania Group. Board member of Volvo
Car AB from 2010-2022 and President and CEO of Volvo Car AB from 2012–
2022. Previous Chairman of Polestar Automotive Holding UK LLC. Previous
Board member of Lynk & Co Investment Co., Ltd., Lynk & Co Europe AB, AB
Volvo, China-Euro Vehicle Technology Aktiebolag and Zenuity AB. Previous
Board member of Ideella föreningen Teknikarbetsgivarna i Sverige and
Ideella föreningen Teknikföretagen i Sverige. Previous senior advisor to
Geely Sweden Holdings AB.
Holdings in Volvo Car AB (publ.), own and related parties: 2,186,631
shares and 2,500,000 call options. 1) 2) 3)
Håkan Samuelsson is as CEO not independent in relation to the company and
the Executive Management Team but he is independent in relation to the
company’s major shareholders.
1) Information on holdings in shares is per 16 February 2026.
2) For information on transactions, please refer to the website of the Swedish Financial
Supervisory Authority. PDMR transactions register | Finansinspektionen
Board of Directors Volvo Car AB (publ.)
Volvo Car AB (publ.) is the parent company of the Volvo Car Group
3) The call options have been issued by Nordea Bank Abp. The term is 2 years, and each
call option entitles the holder to acquire one B share in Volvo Car AB at an exercise
price of SEK 53.
JONAS SAMUELSON
BOARD MEMBER AND CHAIRPERSON OF PEOPLE COMMITTEE AND
AUDIT COMMITTEE
Born 1968.
Board member since 2020.
Education: Master of Science in Economics and Business Administration
from the School of Business, Economics and Law at the University of
Gothenburg, Sweden.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Chairman of the Board of Axel Johnson International and
Rosti Group AB. Board member at Axel Johnson AB, Perrigo Plc and Ansell
Ltd.
Professional experience: Previous experience from finance in various roles
at Saab Automobile AB and General Motors Corporation. Former CFO at
Munters AB and CFO, COO, CEO Major Appliances EMEA and CEO and board
member at AB Electrolux. Former board member in Polygon AB.
Holdings in Volvo Car AB (publ.), own and related parties: 19,807
B shares.1) 2)
Independent in relation to the company and Executive Management Team as
well as the company’s major shareholders.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE / BOARD OF DIRECTORS
51
===== SIDA 52 =====
LILA TRETIKOV
BOARD MEMBER AND MEMBER OF THE AUDIT COMMITTEE
Born 1978.
Board member since 2021.
Education: Studies in Computer Science at the University of California
Berkeley, United States. Studies at SAAD School of Business, University of
Oxford, United Kingdom.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Partner, Head of AI Strategy of NEA. Board member of
Xylem Inc. UBS. Board member of CapGemini, Backflip, Zendesk, CuspAI and
Horizon3.
Professional experience: Previously Corporate VP and Deputy CTO of
Microsoft. Previous experience includes CEO of Engie SA, Terrawatt Initia -
tive and Wikimedia Foundation and several senior positions within Sugar -
CRM Inc., Software General Manager of Evolving Systems Inc., Digital
General Manager of Bank of America and founder of GrokDigital.
Holdings in Volvo Car AB (publ.), own and related parties: 1,197
B shares.1) 2)
Independent in relation to the company and Executive Management Team as
well as the company’s major shareholders.
DANIEL LI (LI DONGHUI)
BOARD MEMBER AND MEMBER OF THE AUDIT COMMITTEE
Born 1970.
Board member since 2012.
Education: Bachelor of Philosophy from the Renmin University of China.
Master of Management Engineering from the Beijing Institute of Machinery
Industry, China. Master of Business Administration from the Kelly School of
Business at Indiana University, United States.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Executive Vice Chairman of Zhejiang Geely Holding
Group Co. Ltd. Chairman of Lotus Group International Ltd and Lotus Tech -
nology Inc. Board member of Geely Sweden Holdings AB, Geely Automobile
Holdings Ltd and Aston Martin Lagonda Global Holdings. Independent
Board member of YTO International Express & Supply Chain Technology Ltd.
Professional experience: Previously CEO, VP and CFO of Zhejiang Geely
Holding Group Co. Ltd. Previous experience from key accounting, financing
and corporate management positions, such as CFO and General Manager of
several companies, including Guangxi Liugong Machinery Co. Ltd, China
Academy of Post & Telecommunication, Cummins Inc., BMW Brilliance
Automotive Ltd., ASIMCO Braking System (Guangzhou) Co. Ltd. and
ASIMCO Braking System (Zhuhai) Co. Ltd. Previously Board member of Pro -
ton Holdings Berhad, ZEEKR Intelligent Technology Holding Ltd, Polestar
Automotive Holding UK Plc, Saxo Bank A/S and independent Board member
of China CYTS Tours Holding Co. Ltd.
Holdings in Volvo Car AB (publ.), own and related parties: 0 B shares.1) 2)
Independent in relation to the company and Executive Management Team
but not in relation to the company’s major shareholders.
DIARMUID O’CONNELL
BOARD MEMBER AND MEMBER OF PEOPLE COMMITTEE
Born 1963.
Board member since 2021.
Education: Bachelor of Arts in History and Government from Dartmouth
College, United States. Master of Arts in Foreign Policy and Political Econ -
omy from the University of Virginia, United States. MBA in Strategy and
Finance from Kellogg Graduate School of -Management, United States.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Advisor to SK On. Chairman of the board of Clarios.
Member of the Supervisory Board of Albemarle Corp, Dana Inc. and Mobility
House Holding AG.
Professional experience: Previous experience from Accenture Consulting,
Real Time Learning McCann Ericson, Young & Rubicam and the U.S Depart -
ment of State. Several executive roles at Tesla. Member of the Executive
team of Fair Financial Corp. Energy/Mobility Consulting for Antin Infrastruc -
ture Partners
Holdings in Volvo Car AB (publ.), own and related parties: 599 B shares.1) 2)
Independent in relation to the company and Executive Management Team as
well as the company’s major shareholders.
1) Information on holdings in shares is per 16 February 2026.
2) For information on transactions, please refer to the website of the Swedish Financial
Supervisory Authority. PDMR transactions register | Finansinspektionen
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE / BOARD OF DIRECTORS
52
===== SIDA 53 =====
RUBY LU (RONG LU)
BOARD MEMBER
Born 1971.
Board member since 2023.
Education: M.A. from Johns Hopkins University School of Advanced Inter -
national Studies (SAIS) and a B.A. with honors from the University of Mary -
land.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Founder and managing partner of Atypical Ventures.
Independent board member of Unilever (NYSE: UL) and an independent
board member of YUM China (NYSE: YUMC) and Kuaishou (1024.HK).
Professional experience: Venture capitalist investing in technology start-
ups in the US and China. Founder of Atypical Ventures, an early-stage tech -
nology investment firm. Co-founder of DCM China, a venture capital firm.
Prior to becoming a venture capitalist, Vice President in Goldman Sachs’
technology media and telecommunication banking group in the US. Former
advisor to and a shareholder in EcarX Holdings, Inc (Nasdaq: ECX).
Holdings in Volvo Car AB (publ.), own and related parties: 65,000
B shares.1) 2)
Independent in relation to the company and Executive Management Team as
well as the company’s major shareholders.
1) Information on holdings in shares is per 16 February 2026.
2) For information on transactions, please refer to the website of the Swedish Financial
Supervisory Authority. PDMR transactions register | Finansinspektionen
PIETER NOTA
BOARD MEMBER
Born 1964.
Board member since 2025.
Education: Master’s degree in Business Administration from the Erasmus
University of Rotterdam, the Netherlands.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Senior Advisor to McKinsey & Company and Board
member in Fortaegis Technologies.
Professional experience: Former Member of the Board of Management
(Vorstand) of BMW AG, responsible for Customers, Brands and Sales. Earlier
senior executive positions at Royal Philips NV (CEO, Consumer Lifestyle as
well as member of the Board of Management), Beiersdorf AG (member of
the Board of Management) and Unilever, all but Unilever with a global
responsibility.
Holdings in Volvo Car AB (publ.), own and related parties: 0 shares.1) 2)
Independent in relation to the company and Executive Management Team as
well as the company’s major shareholders.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE / BOARD OF DIRECTORS
53
===== SIDA 54 =====
CAROLINE GRÉGOIRE-SAINTE-MARIE
BOARD MEMBER AND MEMBER OF THE AUDIT COMMITTEE
Born 1957.
Board member since 2025.
Education: Graduate of Sciences Po Paris and Université Paris 1 Panthéon
Sorbonne (Commercial Law).
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Independent Director and Audit Committee member at
VINCI S.A. (since 2019) and Director of Fnac Darty (Audit and CSR Commit -
tees).
Professional experience: Extensive executive and board experience across
industrial, construction, and finance sectors. Previous board roles include
Elior Group, Bluestar Adisseo, FLSmidth, Wienerberger, Elkem, Groupama,
Eramet, and Safran. Former executive positions include CEO and Chair -
woman of Lafarge Germany, Tarmac France and Belgium and Frans Bon -
homme Group.
Holdings in Volvo Car AB (publ.), own and related parties: 0 shares.1) 2)
Independent in relation to the company and Executive Management Team as
well as the company’s major shareholders.
1) Information on holdings in shares is per 16 February 2026.
2) For information on transactions, please refer to the website of the Swedish Financial
Supervisory Authority. PDMR transactions register | Finansinspektionen
ANNA MOSSBERG
BOARD MEMBER
Born 1972.
Board member since 2022.
Education: MBA from Stanford University, USA, MBA from IE University,
Spain, Master of Industrial Engineering and Management from Luleå
Technical University Sweden.
Principal activities outside of Volvo Car Group and current board assign -
ments and similar: Board member and member of the Finance and Strategy
Committee in Swisscom AG, Board member and member of the Remunera -
tion and Sustainability Committee and Audit Committee in Swedbank AB,
Board member and member of the Nomination and Compensation Commit -
tee in Ringier AG.
Professional experience: Previous experiences include CEO of Silo AB,
Business Area Manager at Google Sweden, Senior Vice President Strategy
and Portfolio Management at Deutsche Telekom AG, CEO of Bahnhof AB
and Vice President of Telia International Carrier AB. Previous board member
and member of the Audit Committee in Schibsted ASA, Orkla ASA, Marshall
AB and Byggfakta AB.
Holdings in Volvo Car AB (publ.), own and related parties: 5,687
B shares.1) 2)
Independent in relation to the company and Executive Management Team as
well as the company’s major shareholders.
OVERVIEW 3
MARKET 15
OUR STRATEGIC FRAMEWORK 18
DIRECTORS’ REPORT 29
RISK 36
CORPORATE GOVERNANCE 42
CORPORATE GOVERNANCE REPORT
BOARD OF DIRECTORS
EXECUTIVE MANAGEMENT TEAM
EXTENDED EXECUTIVE
MANAGEMENT TEAM
AUDITOR’S REPORT
FINANCIALS 61
SUSTAINABILITY 130
THE SHARE 220
OUR HERITAGE 222
VOLVO CAR GROUP / CORPORATE GOVERNANCE / BOARD OF DIRECTORS
54
===== SIDA 55 =====