Volvo announces major restructuring plan

Volvo announces major restructuring plan
Sweden's Volvo Group, the world's second biggest lorry manufacturer, announced Tuesday a 5 billion kronor ($780 million) restructuring plan over two years.

“The programme encompasses both reduction of white collar employees and consultants and efficiency enhancements in the global industrial system,” the company wrote in a statement, without indicating the number of jobs affected.

The Volvo Group, which also makes buses, construction equipment and engines, indicated that the restructuring would mainly concern its lorry business.

The company added that most of the changes “are expected to impact operating income during 2014”, creating savings in the region of 4 billion kronor annually “with full effect achieved by the end of 2015”.

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Volvo has reported disappointing results during the last year and a net loss in the first quarter of 2013, but posted a second quarter profit of 72.8 billion kronor – a 25-percent increase compared to the “weak start” to 2013.

In January the group announced an alliance with Chinese manufacturer Dongfeng aimed at challenging German lorry maker Daimler for the world’s top place.

The Volvo Group employs 112,000 worldwide, including 16,000 consultants and temporary workers.

AFP/The Local/og

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