"It's a tough quarter for us, of course. We have a deterioration in sales in China that is dragging down the result," says the carmaker's global sales manager, Erik Severinson, to TT.
"Volvo Cars expects significantly stronger sales in the second half of the year compared with the first half, driven by growth in Europe, continued recovery in the US and a continued challenging market in China," Volvo Cars writes in the report.
"In Europe, we sell cars to order. There we see that we have a very strong order book and we are taking a lot of orders with the help of our electric offerings," he says.
Volvo Cars reports an operating profit of SEK 0.8 billion for the second quarter. In the corresponding quarter last year, the company made a loss of SEK 10 billion.
Tough in China
The result was worse than expected. Market expectations were for an operating profit of SEK 1.3 billion in the most recently completed quarter.
Revenues in the second quarter of this year fell to SEK 77.7 billion, compared with SEK 93.5 billion a year earlier.
The quarter was marked by a significant weakening of the Chinese market, according to the report.
"It's incredibly difficult to assess the Chinese market now. The overall market is down 20 percent in May, while it's an extremely competitive market with new car brands entering, so it's difficult to assess where the Chinese domestic market is going," says Severinson.
Cost savings
"Despite rising raw material prices, the company has already delivered SEK 5 billion in indirect and variable cost savings this year – six months ahead of schedule," the company writes, adding that this is in addition to the SEK 8 billion in savings implemented in 2025.
"We have done more than we had planned and we are happy about that. It is everything from fixed costs to marketing, but also on the material cost side. It is a fairly broad cost program," says Severinson.
