VOLVO CARS FUTURE OF TRANSPORT RDI

The project concerns the promoter's investments for the development of a new all-electric vehicle platform, including all Research and Development (R&D) activities for the development of its first electric vehicle model based on this platform, the software development activities for the electric platform, safety enhancement and vehicle automation, R&D capital expenditures and specific next-generation advanced manufacturing technology development for fully electric vehicles.

The project concerns the promoter's investments for the development of electric vehicle innovative technologies, safety enhancement and vehicle automation technologies, and specific next-generation advanced manufacturing technology for fully electric vehicles. The project will contribute to the development of innovative vehicle electrification, vehicle automation and safety enhancing technologies, along with the development of advanced manufacturing technologies further enabling the affordability, efficiency, performance and therefore accelerated adoption in the market of electric vehicles, by helping to lower the remaining barriers to adoption and therefore leading to environmental externalities.

The project concerns the promoter's investments to develop more sustainable and safer technologies for electric vehicles,including the development of innovative vehicle electrification technologies, innovative vehicle electronics architecture and safe automation technologies, resource-efficient advanced manufacturing technologies. It will contribute to improving electric vehicle performance, energy and resource efficiency, safety rating, reducing weight and charging time, reducing manufacturing cost and final price, and therefore lowering the barriers to adoption in the market. It will further knowledge creation and diffusion, through the promoter's R&D collaborations and patenting activities, and support continued reskilling and upskilling of the promoter's resources, thus leading to significant positive knowledge, safety, environmental and adoption externalities.

The investments contribute to the Bank's "Innovation, Digital and Human Capital" public policy objective, a part of them also to the EIB Climate Action and Environmental Sustainability policy objective. EIB financing supports the promoter's investments addressing market failures and gaps associated with imperfect competition and incomplete markets for very innovative and still market-entry stage vehicle electrification, safe automation, digitalization and connectivity, and advanced manufacturing technologies, and those addressed by projects with positive knowledge, environmental, safety and adoption externalities generation.

The promoter's experienced management and project implementation capabilities, its focus on innovation and sustainability, its technology edge and industrialisation capability will help implement a sound and sustainable project, integrating positive environmental and social dimensions, contribute to addressing and mitigating market failures, and through its additionality, contribute to the Bank's policy objectives.

The Bank is able to provide a financial value added and capacity to extend a sizeable loan combined with an attractive tenor and disbursement availability periods, with the loan being highly relevant to the company. The EIB loan will further contribute to the diversification of the borrower's financing sources, of which a significant share consists of bonds, and constitutes a critical pillar for the project funding. By that, it is also expected to attract other lenders, mitigating the refinancing risk and facilitating access to other commercial funding sources.

The Bank's technical contribution and advice is explained by the guidance provided to align the Project scope with policy objectives at Project origination.

The R&D activities will be carried out in already existing and authorised R&D facilities. The project does not fall under any of Annexes of the Environmental Impact Assessment Directive - Directive 2011/92/EU as amended by Directive 2014/52/EU and therefore it does not require screening or an EIA Report. Nevertheless, all environmental aspects including possible environmental and operational authorisations will be reviewed during the due diligence process.

The promoter has been assessed by the EIB as being a private company not being subject to EU rules on public procurement or concessions. However, if at the project appraisal, the EIB were to conclude that the promoter is subject to the EU public procurement legislation then the Bank would duly inform the Commission Services and would require the promoter to apply those rules.