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TRUCK

Radiation fears prompt Volvo shut down in Japan

Sweden's Volvo Group, the world's second biggest truckmaker, said Tuesday it was halting the operations of its Japanese subsidiary UD Trucks until next Monday amid growing fears of radiation from damaged nuclear plants.

Published: 15 March 2011 16:29 CET

“UD Trucks recommends all its employees in the Ageo area to stay home as a result of the development in the Fukushima nuclear power plant,” Volvo said in a statement, explaining it had 9,500 employees in Japan and that most were based in Ageo, some 300 kilometers from the plant that was damaged in the major earthquake.

Japanese authorities have not ordered the evacuation of Ageo, but power outages are frequent in the area as in much of the rest of metropolitan Tokyo, Volvo said.

Volvo added all UD Trucks buildings had “suffered minor damages” in the earthquake, and that the company was surveying them further.

Japanese car makers have meanwhile said they were interrupting production until Wednesday or Sunday, even in plants that were not damaged by the earthquake, because of supply issues.

Volvo, whose truck business is second only to Daimler globally and which also makes buses, is no longer linked to the Volvo Cars unit, which it sold in 1999 to Ford, which in turn sold it to Chinese Geely last year.

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VOLVO

Sweden’s Volvo regains strength after pandemic puts brakes on earnings

Swedish truck maker Volvo Group was hit by a sharp drop in earnings due to the coronavirus pandemic, but business rebounded at the end of the year.

Published: 3 February 2021 12:21 CET
Sweden's Volvo regains strength after pandemic puts brakes on earnings
Volvo Group CEO Martin Lundstedt. Photo: Adam Ihse/TT

In 2020, the group saw “dramatic fluctuations in demand” due to the Covid-19 pandemic, chief executive Martin Lundstedt said in a statement.

For 2021, Volvo raised its sales forecasts in its trucks division – its core business – in Europe, North America and Brazil.

However, it said it also expected “production disturbances and increased costs” due to a “strained” supply chain, noting a global shortage of semiconductors across industries.

The truck making sector is particularly sensitive to the global economic situation and is usually hard hit during crises.

In March, as the pandemic took hold around the world, Volvo suspended operations at most of its sites in 18 countries and halted production at Renault Trucks, which it owns, in Belgium and France.

Operations gradually resumed mid-year, but not enough to compensate for the drop in earnings.

With annual sales down 22 percent to 338 billion kronor (33.4 billion euros, $40 billion), the group posted a 46 percent plunge in net profit to 19.3 billion kronor (1.9 billion euros).

Operating margin fell from 11.5 to 8.1 percent.

However, the group did manage to cut costs by 20 percent.

“We have significantly improved our volume and cost flexibility, which were crucial factors behind our earnings resilience in 2020,” the group said.

Volvo's business regained strength in the second half of the year.

“Customer usage of trucks and machines increased when the Covid-19 restrictions were eased during the summer and this development continued during both the third and fourth quarters,” it said.

“Both the transport activity and the construction business are back at levels on par with the prior year in most markets.”

For the fourth quarter alone, the company reported a 38-percent rise in net profit from a year earlier.

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