Technologically speaking, Volvo is fully ready to produce all-electric cars. But the EV market is failing to meet expectations, and remains highly volatile, falling in and out of fashion with the rise and fall of gas prices. But that doesn't mean Volvo intends to let all of the research it's done into batteries go to waste, and the Swedes will be putting all of their effort in this area into expanding its line of plug-in hybrid models.

There is talk in several European cities of closing the city borders to vehicles that run on internal combustion as a means of smog control. Volvo sees plug-in hybrids as the best compromise between meeting these requirements and keeping cars usable between cities. But what's possibly the biggest factor is not wanting to sink a lot of money into developing vehicles which rely on government incentives in order to sell well. Should the government's mood change, and these incentives go away, Volvo doesn't want to be left holding the bag. It simply can't afford to be left in that position.