Volvo starts with ‘internal CO2 tax’

Envoys from the automotive industry are also present at the climate conference in Glasgow. Like sister brand Polestar, Volvo shows its best side when it comes to the climate. Where Polestar also points the accusing finger at other brands, Volvo apparently looks more critically at itself. It has decided to levy €100 per tonne of CO2 emitted by the company. This so-called ‘internal CO2 tax’ is intended to make the company more aware of what it is still emitting and also what its models will cause in terms of CO2 emissions.

Volvo C40

Volvo wants to charge the amount not only for CO2 emissions from the company itself, but also for new cars once they are on the road. According to Volvo, this looks like this: “Under the scheme, each future model will undergo a ‘sustainability test’ and a CO2 tax will be imposed for every tonne of expected CO2 emissions over the entire life cycle of the car. ensuring that even under strict carbon pricing, every model is cost-effective, by steering project, procurement and manufacturing decisions toward the most sustainable option on the table.” COO Björn Annwall clarified: “We are convinced that forward-thinking companies should lead the way by adopting an internal carbon tax. By evaluating future cars for their CO2-adjusted profitability, we expect to accelerate actions that already help us reduce carbon emissions identify and reduce.”

In itself noble, of course, but in a sense money is being shifted. In the case of an internal CO2 tax, the money from the tax normally goes into a pot that can be used for further reduction of emissions. Volvo itself will ultimately reap the benefits of this once a CO2 tax is imposed from the outside. Furthermore, this is also primarily a way for Volvo to gain insight into what it would otherwise have lost on this. That is what Annwall means by ‘evaluating models for CO2-adjusted profitability’.