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VOLVO CARS

Volvo mulls recall over engine problem

Swedish car maker Volvo warned customers on Monday that it was considering a recall of eight models after the discovery of an engine problem that could cause their cars to suddenly accelerate.

“We are now sending out a letter to approximately 150,000 customers all over Europe, in approximately 30 markets, telling them that we are investigating a technical issue relating to increased oil levels in diesel engines with particle filters,” Volvo cars spokesman Per-Åke Fröberg told AFP.

Fröberg told AFP the company would consider a recall if its investigation showed that such action was necessary.

But he added that for the time being Volvo was “informing (customers) of the problem and asking them to check out their oil levels, which everybody should do anyway.”

“The problem is that engine oil may enter the combustion chamber and act as additional fuel. This leads to maintained or increased engine speed,” Fröberg

explained.

He said the problem could manifest itself in different ways, “but it could be that you take your foot off the accelerator and the car keeps the same pace as before or it might, in some isolated cases, also increase the speed.”

The problem was discovered after several incidents were reported by different customers in late 2009 and concerns eight car models that have a five cylinder diesel engine with a diesel particle filter.

Fröberg said the first notification letters would land in customer post boxes by the end of this week.

Those who see their oil level above the maximum indication should consult their Volvo dealer, he said.

In an interview with Swedish public radio, Fröberg said the problem could not be compared to the accelerator and brake defects that has caused auto giant Toyota to recall more than 10 million vehicles worldwide.

“First and foremost it’s not the same problem that Toyota has had. The biggest difference is that customers have the possibility of making sure it doesn’t happen by checking their oil level,” he said.

Swedish-made Volvo spent a little more than 10 years as a Ford brand before being sold in March to China’s Geely.

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CARS

Volvo stays in fast lane despite China dip

Swedish automaker Volvo Cars, owned by China's Geely, reported Wednesday a rise in first half profits even as sales tumbled in its biggest market, China.

Volvo stays in fast lane despite China dip
Volvo Cars' Swedish chief executive, Håkan Samuelsson. Photo: Bertil Ericson/TT

Note: An earlier version of this story said that first-half profits fell. While net profit attributable to shareholders indeed fell, overall net profits were up. The story has been amended to reflect this.

Net profit more than tripled to 877 million kronor (92 million euros, $56 million), while turnover climbed by 12 percent to 75.2 billion kronor.

Operating profit surged by more than 70 percent to 1.66 billion kronor, thanks to a strong US currency and robust sales of Volvo's SUV model XC60.

But net income attributable to owners of the parent company dropped by 60 percent to 173 million kronor (18 million euros, $20 million).

Volvo's overall car sales in terms of units rose by 1.4 percent to 232,284 during the first half.

The strongest sales growth was registered in Sweden and western Europe, while they remained stable in the United States and declined in China, by 1.2 percent, and the rest of the world, including Russia.

Volvo went through several dark years before returning to profit in 2013. In 2014, it beat its sales record from 2007, selling almost 466,000 vehicles. CEO Hakan Samuelsson told Swedish news agency TT the company expects to sell 500,000 cars this year.

The number of Volvo employees has risen by 10 percent in the past year, to 28,000 worldwide.

Despite its economic slowdown, Volvo plans to boost its presence in China and has acquired 50 percent of three joint ventures from parent company Geely: two assembly plants and one research and development centre.

Geely paid $1.8 billion to buy Volvo from US carmaker Ford in 2010.