Volvo will only make electric and hybrid cars starting in 2019

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Volvo also announced it would launch five new electric and hybrid cars between 2019 and 2021, and that two of those will be made by Polestar, which the company recently announced would become its own subsidiary and brand selling performance EVs, likely to compete with high-end Tesla models.

Part of the cost benefit of making electric cars is dealing with ever stronger emissions requirements on vehicles, which are set to tighten in most key international markets, including China, which is where Volvo's owner Geely is based. Production costs of EV parts and batteries are also getting smaller, as capacity and manufacturing processes improve.