The Swedish company announced in a statement that every Volvo launched from 2019 onwards will have an electric motor and described the move as marking the "historic end" of cars powered solely by petrol or diesel.
Volvo said it is placing electrification "at the core of its future business" and that its decision to embrace the growing technology paves the way for "a new chapter in automotive history".
"This is about the customer," said Håkan Samuelsson, Volvo's President and Chief Executive. "People increasingly demand electrified cars and we want to respond to our customers' current and future needs."
Now owned by Chinese automotive giant Geely, which has been investing heavily in Volvo since acquiring the company from Ford in 2010, Volvo sold more than 534,000 cars in around 100 countries in 2016.
With sales at that level, Volvo's announcement is significant and lays down a challenge to other auto brands exploring the growing possibilities of electrification.
"This announcement marks the end of the solely combustion engine-powered car," Samuelsson asserted. "Volvo Cars has stated that it plans to have sold a total of 1m electrified cars by 2025. When we said it we meant it."
Volvo's plans involve the launch of five fully electric cars between 2019 and 2021, including three full Volvo models and two of its Polestar high performance sub-brand.
These will be supplemented by a range of petrol and diesel plug in hybrid and mild hybrid 48 volt options on all models, which Volvo said represented "one of the broadest electrified car offerings of any car maker".
Commenting on the development, Prof David Bailey of Aston University told the Guardian that he expected the automotive industry to reach a "tipping point" by the mid-2020s when electric cars begin to sell more than traditional models.
"It's indicative of the speeding up of the shift over to electrics, particularly in the wake of the VW dieselgate scandal, and it's a sign that the industry is really starting to move and it will become mainstream," he said.
"By the mid-2020s I expect there to be a tipping point where the electric car starts to outcompete the internal combustion engine. It's the way it's going."
Data sourced from Volvo, Guardian; additional content by WARC staff