Production of Volvo’s flagship electric crossover is pushed ‘five or six months.’ U.S. deliveries are expected to begin in the third quarter of 2024.
Volvo Cars‘ biggest product launch since the XC40 in 2017 is hamstrung by an issue many automakers are grappling with in this age of advanced technology vehicles.
Volvo has delayed production of the new electric EX90 crossover to mid-2024 as engineers work to incorporate a key safety technology into the flagship model’s new platform. On the company’s earnings call Thursday, Volvo Cars CEO Jim Rowan pinned the “five- or six-month” delay on the “complexity of the software code” around the EX90’s lidar system.
The remote-sensing lidar technology uses laser light pulses to render precise images of the environment around the vehicle. Volvo said lidar and other sensors on the EX90 create an “invisible shield of safety” that can help reduce accidents that cause serious injuries or death by up to one-fifth.
The EX90 is the first Volvo to incorporate lidar and will offer the technology as standard equipment.
“We’re writing a lot of [the] software ourselves,” Rowan said. “We wanted to make sure that the first time we put lidar into our safety stack … it operates in the way it should.”
The delay, Rowan said, gives Volvo engineers “a little bit more time to get that done.” But it could push the crossover’s market debut into the third quarter of 2024.
Volvo’s predicament is one shared by several legacy automakers.
Volkswagen Group has delayed top models, including the electric Porsche Macan, for at least two years as it worked to get the software ready on time. Buggy software in part delayed the launch of McLaren’s Artura plug-in hybrid. The supercar was originally scheduled to arrive in fall 2020 but did not go on sale until late last year.
Lidar is a key differentiator for Volvo, a brand that built a legacy on safety.
Historically, the Swedish automaker has standardized emerging safety features such as the three-point seat belt and side-impact airbags.
Self-driving car sensor startup Luminar Technologies will supply Volvo with its Iris lidar and Sentinel software, which will be integrated with Volvo software in the EX90.
The lidar system, which Volvo said can detect pedestrians up to 820 feet away, even at highway speeds, is part of the EX90’s road-monitoring system, which includes cameras, radars and ultrasonic sensors.
“The difference lidar can make for real-life safety is remarkable,” Rowan said earlier. “Research indicates that adding lidar to a car can reduce accidents with severe outcomes by up to 20 percent, and overall crash avoidance can be improved by up to 9 percent.”
Research firm IDTechEx estimates the automotive lidar market to grow to $8.4 billion in a decade, powered by increased adoption of autonomous vehicles and advanced driver-assistance systems.
Volvo’s decision to bundle the expensive technology as standard equipment also sets it apart in the industry.
Vehicles with Level 2 autonomous capabilities have lidar components starting in the $1,500 to $2,000 range, and lidar for cars with Level 3 capabilities can cost even more.
Despite the high sticker price, Volvo is betting the safety tech will drive the adoption of automated services that the company can charge for.
Luminar CEO Austin Russell has described Volvo’s decision to bundle lidar as a “watershed moment for the industry.”
“You don’t have an option package for airbags. You don’t have an option package for seat belts,” he said. “Why should you have an option package for lifesaving technology?”
The EX90 will be the first EV assembled at Volvo’s 2.3 million-square-foot plant in Ridgeville, S.C., an hour northwest of Charleston. EX90 production was to have begun in late 2023.
Rowan’s willingness to delay EX90 production — a complicated and expensive proposition — to get the product right out of the gate underscores the significance of the EX90 to Volvo’s ambitions to pivot profitably into an all-electric brand by the next decade.
The seven-seater is expected to become the brand’s No. 1 volume EV in the U.S., Volvo’s second-largest market after China, the brand’s former Americas boss, Anders Gustafsson, told Automotive News ahead of the model’s reveal late last year.
“The EX90 is built for the U.S. market with a 100 percent focus on electrification,” Gustafsson said. “The volume on this car will be significant in year one for our [retail] partners.”
