Volvo will axe jobs across its global network as part of a wide-reaching drive cost-cutting drive in response to "external headwinds" hampering its performance.
The Swedish brand today announced a SEK 18 billion (£1.4bn) saving strategy that will result in "redundancies at its operations around the globe" but has yet to confirm the locations and the number of jobs impacted.
Volvo said it was striving "to protect profitability and drive structural efficiencies on direct and indirect costs, as well as helping to offset external headwinds" and that most of the effects will be realised next year.
Expecting that 2025 will be a "challenging and transition year, given the uncertainties around macroeconomic, geopolitical and market developments", Volvo said it will no longer provide financial guidance for 2025 and 2026.
The news comes just weeks after former CEO Håkan Samuelsson was reappointed following the departure of Jim Rowan after three years.
Last week, the company also replaced chief financial officer Johan Ekdahl with his deputy Fredrik Hanson.
The strategy has been announced following a turbulent first financial quarter of the year, in which Volvo's global deliveries dropped 6% year on year to 172,000, resulting in an 11.7% drop in revenue from £7.3bn to £6.4bn.
Volvo said the drop in wholesales was the result of a "planned inventory reduction" in the final months of 2024.
Its earnings before interest and tax were down substantially, too, from £370m to £120m.
As a result, it's trimming its planned investments "in addition to the already planned lower investments going forward".
Samuelsson said: “The automotive industry is in the middle of a very difficult period with challenges not seen before. Over the last few weeks, I have worked with the management team and other colleagues on a plan to make the company stronger and more resilient.
"While our strategy is clear, we must get better at delivering results. Given the turbulence in the market, we need to further improve our cash flow generation and lower our costs.
"While we still have a lot to do, our direction going forward is focused on three areas: profitability, electrification and regionalisation.”
This confirms that Volvo will pursue a more regionalised approach to model development. It recently revealed an updated S90 saloon exclusive to the Chinese market and will soon reveal its first range-extender EV for China, too.
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