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VOLVO

Former Volvo CEO to receive generous pay-off

Former Volvo Cars CEO Stefan Jacoby, who left his post after two years due to ill health, will not be leaving empty handed. According to company policy he is entitled to some 8 million kronor ($1.2 million) in severance pay.

Published: 5 November 2012 14:33 CET
Former Volvo CEO to receive generous pay-off

“That is what it says in the annual financial report but I won’t comment on Jacoby’s terms,” said Volvo spokesman Per-Åke Fröberg to news agency TT.

According to the annual report, members of the Volvo board are entitled to a year’s full pay as a golden parachute.

Calculated from Jacoby’s wages from 2010 and not counting any potential increments for 2011, he should be getting some 8 million kronor, according to Swedish business paper Dagens Industri (DI).

In October, Håkan Samuelsson, former chairman of German truckmaker MAN, was named the new Volvo CEO, taking over from Jacoby who had suffered a stroke in September.

In a statement issued shortly after he fell ill, Jacoby wrote that it was a minor stroke, which restricted mobility of his right arm and to some extent of his right leg.

At first he was expected to be able to return to work after a month or so. However, at the beginning of October there were rumours indicating that there were rifts within the company.

Reuters news agency reported on a rumoured conflict between Jacoby and board chairman Hans-Olov Olsson, citing anonymous sources.

However, Olsson denied the rumours in an interview with TT, saying that though there were of course discussions in the boardroom among the top layer of Volvo officials, there was no open conflict.

TT/The Local/rm

twitter.com/thelocalsweden

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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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