Volvo Cars loses billions of kroner again. In the third quarter of 2024 alone, the result has fallen by DKK 3.73 billion. Now the boss lowers expectations and announces savings.
Volvo Cars is facing challenges where the company must deal with both economic losses and the need for savings.
According to the accounts for the third quarter, the company's operating profit has fallen by around six percent. At the same time, a reduction in the ownership of Polestar has led to a significant increase in the reported profit.
However, the company's margin has fallen from 6.7 percent to 6.2 percent, reflecting a tighter economic situation.
Another concern is that cash flow is still negative at -0.4 billion kroner. Managing director Jim Rowan makes it clear that tough times are ahead.
– Our journey towards 2026 will not be linear, as our industry faces an increasingly unstable environment. The macroeconomic headwinds are increasing, as are the geopolitical complexities, says the director.
READ ALSO: Haas concedes another Kevin Magnussen error
Rowan points out that the sales forecast for 2024 has been revised, so that expectations are now for a volume increase of 7-8 percent against the previous 12-15 percent.
Volvo Cars is also investigating opportunities to save money. Among other things, the car brand will review all its fixed and variable costs and investments
Rowan emphasizes that Volvo will focus on cost reduction to save money and navigate through the economic challenges.
– We cannot control the current geopolitical uncertainty and economic headwinds. But we can navigate them with speed, purpose and a clear focus.
– Our focus is more than ever on preserving cash and at the same time creating value – for our shareholders, customers and employees, says the director about the possible savings exercise.
Despite the challenges, there are also positive signs for Volvo Cars. The company has experienced a sales increase of 3 percent in the third quarter with a total of 172,849 cars sold.
A significant share of these sales, 48 percent, is made up of electrified models, both fully electric cars and plug-in hybrid cars.
– We have proven in the past that we can handle challenges, and we will handle them again. Business is not a game about perfection, it's a game about progress, says the director, referring to the fact that Volvo has fought its way out of economic problems.
Overall, the report emphasizes both the economic challenges facing Volvo Cars, as well as the measures necessary to adapt to an unstable market situation.
Read more exciting news from and about the world of cars right here!
