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Volvo Cars invests in BP-backed charging firm to lure electric buyers

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Volvo Cars invests in BP-backed charging firm to lure electric buyers
FILE PHOTO: The logo of Volvo is seen on the front grill of a Volvo XC40 SUV displayed at a Volvo showroom in Mexico City, Mexico April 6, 2018. REUTERS/Gustavo Graf   -   Copyright  GUSTAVO GRAF MALDONADO(Reuters)
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By Esha Vaish

STOCKHOLM (Reuters) – Volvo is investing in a startup called FreeWire whose rapid charging systems for electric cars are being installed across BP gasoline stations in Europe this year.

Fast charging is a crucial factor in luring customers to electric cars, reflected in moves across the sector. BMW, Daimler, Ford and Volkswagen <VOWG_p.DE> for instance have jointly pledged to open 400 ultra-fast charging stations in Europe by 2020, aiming to close the gap with Tesla.

Yet Volvo, owned by China’s Geely Holding [GEELY.UL] and whose XC40 sport utility vehicle will be its first all-electric offering in a strategy to generate half of its sales annually from fully electric cars by 2025, has said it does not see itself owning service or charging stations.

Through its Volvo Cars Tech Fund, the Swedish company said it had bought a stake in FreeWire, though it gave no further details.

The fund’s CEO Zaki Fasihuddin said Volvo expected an already visible shortage of charging points to grow in magnitude as a wave of electric cars hits the streets in five years.

“With electrification there’s going to be a lot of pressure not only to build infrastructure, but also to help consumers get over the range anxiety they feel,” Fasihuddin told Reuters. “We think FreeWire is attacking that problem is a good way.”

Fasihuddin said Volvo’s investment would allow it to play an influential role in designing products with FreeWire and to work with BP, which invested $5 million in FreeWire in January.

“If you look at the possibility of piloting an innovation, (BP’s involvement) just makes it all the more possible because we get to utilise our and BP’s retail networks and that gives us a bigger, global sandbox to play in,” Fasihuddin said.

(Reporting by Esha Vaish in Stockholm; Editing by Niklas Pollard and David Holmes)

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