US and Japan fuel surge for Volvo trucks

Sweden's Volvo, the world's second-largest maker of trucks, said Friday it saw a spike in profits in the third quarter, boosted by thriving sales in the US and Japanese markets.

US and Japan fuel surge for Volvo trucks
Ed Carbaugh prepares to install parts on a truck engine on an assembly line at Volvo Trucks' powertrain manufacturing facility in Hagerstown, Maryland, March 2014. Photo: Patrick Semansky/AP

Net profit increased eight percent to 1.5 billion kronor ($206 million), while sales rose 3.6 percent to 67.2 billion kronor, above expectations by analysts who had forecast 63.8 billion kronor.

"The market development in the third quarter followed the overall direction from the second quarter with good momentum in North America and Japan," chief executive Olof Persson said in a statement.

At the same, there was "continued slow development in the emerging markets in South America and Asia," he said.

In Europe, the company had seen increased uncertainty in many markets based on the political and economic situation, which has led to the positive momentum from the first half of the year leveling off, the company said.

One year ago, the then struggling Volvo Group announced the elimination of 2,000 jobs of managers and consultants.

For 2015, the company predicted the market for heavy-duty trucks would be at the same level as in 2014 in Europe, Japan and China, while higher in North America and India.

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Volvo group announces record sales for 2011

Volvo Group, the world's second-largest truck maker, announced Friday a 63-percent jump in its 2011 net profit boosted by record sales and margins, and a 43-percent hike in the fourth quarter.

Volvo group announces record sales for 2011

“If we review the full-year 2011, the Volvo Group generated the highest net sales, the best operating income and the highest operating margin to date,” chief executive Olof Persson said in a statement.

For the full-year, the group’s net profit rose 63 percent to 17.75 billion kronor (2.0 billion euros, $2.65 billion), and by 43 percent in the final quarter to 4.72 billion kronor.

Sales rose 18 percent to 310.3 billion kronor last year, and increased by the same amount to 86.5 billion in the fourth quarter alone.

The quarterly profit and sales figures beat the expectations of analysts surveyed by Dow Jones Newswires, who had forecast 4.67 billion kronor and

81.05 billion kronor respectively.

“The improved results were primarily due to higher sales,” Persson said.

“The group is financially strong in an environment that is currently characterised by turmoil in the financial markets and uncertain macro-economic trends,” he added.

The group’s full-year sales were mainly driven by a 21-percent rise in

truck sales to 200.7 billion kronor and a 22-percent rise in bus sales to 22.2

billion kronor.

Volvo posted its biggest ever increase in truck sales on the North American market, which were up by 75 percent in terms of volume and by 38 percent in terms of value for the full-year.

The overall truck market in North America, for all brands, rose 52 percent last year with 216,000 units sold. The strong demand was attributed to the need to replace ageing fleets, the group said.

Worldwide, Volvo sold some 238,391 trucks in 2011, up 32 percent over 2010.

In Europe, Volvo said it expected a slow recovery in early 2012 with a gradual pick-up in demand as customers start to renew their fleets ahead of new emissions regulations in 2014.

The group said its outlooks for North America and Europe remained unchanged

for 2012.

Volvo shares were up 1.71 percent in midday trading on a Stockholm exchange

up just 0.58 percent.

At the end of December, the Volvo group had 98,162 employees, compared to

90,409 a year ago.