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SAFETY

Volvo recalls 59,000 cars with ‘unpleasant’ software glitch

Swedish carmaker Volvo is recalling 59,000 cars across 40 markets over a fault in the car’s software that can temporarily shut down the engine.

Published: 21 February 2016 14:05 CET
Updated: 21 February 2016 15:42 CET
Volvo recalls 59,000 cars with ‘unpleasant’ software glitch
A Volvo V70, one of the models affected by the software problem. Photo: Bertil Ericson/TT

The software fault is restricted to five-cylinder diesels from the 60 and 70 series constructed from the middle of 2015.

Almost half of the affected cars are in Sweden, but Britain and Germany are also key markets. 

Group spokesman Stefan Elfstrom said that the glitch can be “unpleasant” but there had been no recorded accidents as a result.

The glitch can shut down the engine and electrical system while the car is in motion, but Mr Elfstrom said they would then both restart immediately.

The problem had been reported by drivers of new Volvos who said that the fault causes a brief absence of steering and braking.

The company says it will write to owners who can have the problem fixed at no cost at local dealerships.

The news comes just two days after Volvo, owned by the Chinese Geely group, announced a massive increase in net profits.

Net profit jumped nearly nine-fold to 4.48 billion kronor ($527 million) in 2015.

Turnover was up 19 percent on the back of record unit sales of 503,127, up eight percent from 2014.

“We had to make bold decisions in the last few years – that was a necessity – by investing to have new vehicles, new motors, new platforms,” chief executive Håkan Samuelsson told the AFP news agency on the margins of the automaker's results presentation.

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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