Volvo Global Sales Fall 7.4% in Jun-Aug as China Discounts Fail to Lift Demand

Volvo Cars sold 148,239 vehicles globally from June through August 2026, down 7.4% year on year, according to data released by the automaker on Sept. 2.

Despite the overall decline, sales of electrified models continued to grow. Sales of fully electric and plug-in hybrid vehicles reached 79,336 units, up 13% year on year and accounting for 53.5% of global sales.

Fully electric vehicles accounted for 29% of total sales, while plug-in hybrids represented 24.5%.

The figures mean electrified vehicles now make up more than half of Volvo’s global sales even as overall deliveries decline, leaving its conventional combustion-engine lineup under greater pressure.

Volvo attributed the latest sales decline primarily to continued weakness in China.

The company said a softer macroeconomic environment and intensifying competition in the auto industry had weighed heavily on its China business.

The US market also faced pressure, with weaker demand for both fully electric and plug-in hybrid vehicles weighing on overall sales.

Against the backdrop of changing conditions in its two major markets, Volvo Chief Commercial Officer Erik Severinson said the company was currently placing greater emphasis on maintaining transaction prices rather than simply pursuing higher sales volumes.

That strategy faces a different reality in China, where Volvo has significantly lowered retail prices on some models in an effort to sustain sales.

In August, Volvo offered a limited-time trade-in incentive on its flagship S90 sedan, with the entry-level model carrying a list price of RMB 406,900 ($60,545).

The discounted reference price fell to RMB 229,900 ($34,205), a reduction of nearly RMB 180,000 ($26,784).

At the same time, publicly advertised online prices for models including the XC60 and XC70 had generally fallen to around 50% to 60% of their original list prices.

Price adjustments have not been limited to retail channels. When the 2026 XC70 and S90 were launched, Volvo also introduced limited-time reference prices that were substantially below their official list prices.

The deeper discounts, however, have yet to produce a meaningful rebound in sales.

Data from a third-party platform showed that monthly S90 sales in China had fallen to roughly 300 to 500 units between April and July this year.

Volvo is not alone in facing this pressure. Since the beginning of 2026, price competition in China’s luxury-car market has continued to spread into the mid- to large-size segments.

Transaction prices for some models from Mercedes-Benz, BMW and Audi fell to around RMB 250,000 ($37,200).

The downward shift in pricing among Germany’s three major luxury brands has further squeezed the space available to second-tier luxury marques, making it increasingly difficult for brands such as Volvo to preserve pricing through traditional brand premiums.