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VOLVO

Volvo halts production at Swedish plant

Volvo Cars, part of China's Geely group, said on Monday that production at one of its main plants would be suspended for a week due to a slowdown in the European auto market.

Published: 15 October 2012 11:21 CEST
Volvo halts production at Swedish plant

Production at Torslanda, next to the company’s Gothenburg headquarters, will be temporarily halted from October 29 until November 2.

“The measure is taken based on a continued decline of the automotive market, primarily in Europe. Therefore a further adjustment to Volvo Car Corporation’s manufacturing operation is necessary,” the company said in a statement.

On October 1 Volvo reduced the production pace at Torslanda to 50 cars per hour, down from 57.

During the week-long suspension, “Torslanda plant employees will be on leave with pay through a combination of utilizing time banks and leave of absence,” it said.

Volvo Car Corporation is a separate entity from Volvo Trucks, the maker of trucks, buses and construction machinery, since the auto company was sold in 1999.

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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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