Volvo is now shutting down what was thought to be the car's answer to Spoitfy. Instead, the car-sharing service Volvo On Demand is buried and 50 people lose their jobs.
Volvo closes its car-sharing service 'On Demand' and lays off 50 employees. The car manufacturer has decided to discontinue the service due to a difficult economic climate that has rapidly increasing operating costs.
– The notification is obviously a difficult message to give to the affected employees, who have also done a very good job," says Jessica Span, managing director of Volvo Car Sweden to Dagens Industri .
Launched in 2022 as a further development of the previous platform Sunfleet, Volvo On Demand aimed to create a "Spotify with cars". Despite a fleet of 1,200 cars and 200,000 users, the service failed to make a profit and therefore closes completely.
– The decision has been taken against the background of a more challenging macroeconomic environment, which resulted in increased costs to run the service with the quality that Volvo Cars requires and our customers can expect, writes Volvo.
Translated into ordinary Danish, this means that Volvo could not get the idea to live on market terms.
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Unlike Sunfleet, which was profitable, On Demand has been a loss-making business for Volvo.
However, according to Jessica Span, it is difficult to compare the two services because they existed under different economic conditions.
– It is difficult to compare, as it has been in different times with different conditions both in terms of cars, interest rates and costs for, for example, parking, she says to Dagens Industri.
Customers can continue to book cars through Volvo On Demand until 13 January next year, after which the service will close permanently. The service never reached Denmark – the closest was Helsingborg.
The money that Volvo gets released now may have to be used to fix a serious error that has affected 119 cars in Denmark. Read more about it here .
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