• Sweden edition
 
Volvo profits plummet as global sales slump

Volvo profits plummet as global sales slump

Published: 05 Sep 2012 17:17 GMT+02:00
Updated: 05 Sep 2012 20:52 GMT+02:00

Swedish carmaker Volvo reported an 84 percent drop in operating profit through the first half of the year compared to 2011 amid slumping sales and tough competition.

Volo Cars, owned by China's Geely Holdings, reported operating profit of 239 million kronor ($35.63 million) in the first six months of 2012, compared to 1.53 billion kronor during the same period last year.

Turnover rose to 65.3 billion kronor from 62.8 billion kronor the year before, while global sales also dropped 4.1 percent to 221,309 cars.

According to Volvo Cars CEO Stefan Jacoby, the economic uncertainties plaguing many of the carmakers major markets are likely to continue through the end of the year, and competition remains fierce.

"We find ourselves in a transition," he told reporters in Stockholm on Wednesday.

"We need to get used to the fact that we live in an unpredictable global environment."

Jacoby said a looming recession in the eurozone has already resulted in lower sales in southern Europe and Sweden.

Through August, Volvo sales in Sweden are down 12.4 percent to 32,145 cars.

Jacoby however rejected rumours of trouble with the building of Volvo's planned factory in China, saying the plant was scheduled to be in operation by 2014.

The worsening market conditions mean that Volvo will reduce production to 50 cars per hour at its factory in Torslanda near Gothenburg, resulting in the shedding of 287 positions provided by a staffing company.

But Jacoby said no layoffs of permanent staff were planned.

"For the moment, we have no ambitions to get rid of any of our full-time workers or managers," he said, according to TT.

TT/The Local/dl

Follow The Local on Twitter

Don't miss...X
Left Right

Your comments about this article

20:31 September 8, 2012 by viennacalling
If you go to Autodata US they have the august sales statistics and the big 4 Ford GM Chrysler and Toyota had a good month and YTD dont forget the japanese sales are still affected by the sunami. to me it appears that the strength of the kroner is affecting sales of the volvo
03:34 September 12, 2012 by Escort
Could this be due to the fact that Volvos are now too expensive? They have increased their prices significantly in recent years and there is much talented competition from Ford, VW, Honda, etc. which is more affordable. Almost £20,000 for the base V40 puts these beyond the reach of many private buyers who have bought Volvo in the past. They will buy a Focus, Golf or Civic instead and Volvo will left with falling sales and profits. Who can blame them?
17:18 November 10, 2012 by oledeluca
High quality, reliable and safe cars that are environmentally sound are needed but most of all - they MUST be affordable by the many! I believe that here in the USA Volvo will be a has-been. Now their primary market is the luxury market, not the middle of the line vehicles. We cannot buy an S40, V50, V40 or even a V70 only big fat gas hogs like the XC90. Big mistake! Hope they don't go the way of my favorite vehicle.... SAAB or everyone will be buying Toyota Prius', Honda Accords and my little new car the VW Golf.
21:30 February 9, 2013 by Ivan1619
Prior to owning Volvo's I owned Saabs. I loved the Saab's and was very disappointed whem GM got a hold of the company. As for Volvo's, I presently own two a 2013 S60 and a 2005 V50. I switched to Volvo's because of the quality and look upon them as the Swedish Mercedes. However, I do wish you would keep your Volvo (Local) page up to date. Although Geely now owns Volvo I am very concerned about their influence and the possibility Geely will cheap out the brand. As mentioned, cost of the car has become an issue and I suppose that's why you may build them in China. Like many I will not own a Chinese built Volvo. The Chinese Car makers have not reached Swedish standards or American standards for that matter. In summary, the idea of going to only four cylinder engines may be a mistake. If you do keep the T5 or T6 as an option. Lets hope that Volvo's will not become a has-been in the US or world market.
Today's headlines
Sweden scraps 'new start zones' after EU input
Integration Minister Erik Ullenhag visits a school in Tensta, one of the neighbourhoods mentioned when he and his colleagues first floated the new start zone proposal. File: TT

Sweden scraps 'new start zones' after EU input

Sweden has abandoned a plan to ease taxes for small companies in blighted areas after the European Commission challenged its legality. READ () »

'Easter eggs an invitation to spread germs'
A typical Swedish Easter egg. Photo: Jessica Gow/TT

'Easter eggs an invitation to spread germs'

A Swedish microbiologist has warned that traditional Swedish Easter eggs laden with candy are an open invitation to the spread of bacteria and viruses. "Is this really a good idea?" he asked. READ () »

Jammed truck snarls Stockholm rush hour
Photo: Anders Wiklund/TT

Jammed truck snarls Stockholm rush hour

PICTURES: A truck got wedged inside a tunnel in central Stockholm on Thursday, with authorities concerned the accident may have damaged cables in the tunnel's ceiling. READ () »

Kids in Victorian garb mark Swedish Easter
A Swedish Easter witch holding daffodils. File photo: TT

Kids in Victorian garb mark Swedish Easter

In India, I'd notice Easter only from the traffic jam outside the churches, but here witches, egg hunts, and feathers mark the Christian holiday. The Local's Deepti Vashisht brings you the various shades of Swedish Easter. READ () »

Swedish MP ordered chemtrail probe
Chemtrails?: Shutterstock.

Swedish MP ordered chemtrail probe

A Swedish MP who launched an official government investigation into the existence of chemtrails tells The Local why he thinks Swedes deserve the truth, even if it may leave some conspiracy theorists unsatisfied. READ () »

PM pleads ignorance of Vattenfall's Nuon bid
Fredrik Reinfeldt answers the constitutional affairs committee's questions. Photo: TT

PM pleads ignorance of Vattenfall's Nuon bid

Sweden's prime minister on Thursday said Vattenfall itself, not its owners the Swedish state, had responsibility for the loss-making Nuon deal. READ () »

'Kockums submarine raid may be illegal': lawyer
Photo: TT

'Kockums submarine raid may be illegal': lawyer

A Swedish lawyer says the Swedish military may have broken the law when it raided the Malmö premises of German defence giant Thyssen Krupp. READ () »

Good weather could blight Easter traffic
Easter traffic two years ago on the E4 motorway. File: Jessica Gow/TT

Good weather could blight Easter traffic

Traffic experts have cautioned Swedes heading to the countryside for what should be a sunny Easter, warning that the most serious accidents often take place when the weather is clement. READ () »

Saab offers Gripen lease to Malaysia
Jas Gripen jets in flight. File photo: TT

Saab offers Gripen lease to Malaysia

Swedish defence giant Saab has offered to rent out fighter jets to Malaysia. READ () »

What's On in Sweden

What's On in Sweden

Check out what's happening with The Local's guide to the main attractions and events in Stockholm, Gothenburg and Malmö - in association with DoToday. READ () »

RECEIVE OUR NEWSLETTER AND ALERTS
Society
Swedish supermarket Ica pulls contested Easter commercial off air
Kungahuset
Society
Swedish royals set baptism date for princess
finest.se
Gallery
People-watching April 16
Politics
Who's the prime minister's heir?
Alfie Atkins
Society
Are children's books the key to families integrating in Sweden?
National
'Sweden Dem protests cater to party's martyr image'
National
'Swedish research grants were fantastic, but now it's like Australia'
Society
Only in Sweden: The ten problems you'd never encounter elsewhere
National
Swedes stopped to take my picture, but didn't look me in the eyes
Business & Money
A swipe of the hand replaced cash and cards in Lund
YouTube
Features
Video: Oliver Gee finds out how to embrace The Swedish Hug
TT
National
Abba duo hints at reunion
Advertisement:
Private
National
Flash mobs hug it out across Sweden
Finest.se
Gallery
People-watching April 11-13
TT
Politics
Swedes to give six-hour workday a go
TT
Society
Aussie choir member wows Abba in Sweden
YouTube
Society
Stockholm magic a surprise YouTube hit
Fastighetsbyrån
Society
Gallery: The Local's Property of the Week
Private
Society
Swedes find 200-year-old gravestone in living room
Stockholm School of Economics
Sponsored Article
Why a bachelor's degree is no longer enough
Deepti Vashisht
Features
Deepti Vashisht dissects the magic of Sweden's personal ID number
Shutterstock
Society
Ten signs you've been in Sweden too long
Society
Jimi Fritze heard every word when doctors discussed taking his organs
Society
A Swedish farmer explains why the new bestiality ban is 'pointless'
ESL
Sponsored Article
Learning Swedish the easy way
Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Blog Update: The Diplomatic Dispatch

28 October 15:16

The Green Growth Group Summit »

"Today on the 28 October in Brussels, a large group of key EU Ministers and business people, including UK Secretary of State for Energy and Climate Change Edward Davey, and Swedish Environment Minister Lena Ek, will meet to discuss green growth. They all have a stake in resolving a challenge which, although it is crucial..." READ »

748
jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
www.swedishdowntown.com