The measures will save five billion kronor and affect 2,000 positions in Sweden. According to the company, this will be achieved by terminating consulting contracts, through natural attrition and with targeted severance packages for employees.
The important thing to point out here is that we will do this through voluntary resignations and by being very restrictive with hiring. We are not going into exactly what the mix will look like, says the company’s CFO Fredrik Hansson to TT when asked how many permanent employees are affected.
According to Fredrik Hansson, the cuts will not affect production employees, but rather white-collar workers.
Geographically, which of your operations will be affected?
It’s clear that we have a very large presence in Gothenburg, of course.
Will the majority be in the Gothenburg area?
Yes.
The savings package is the second in a short time. In 2025, around 3,000 jobs were cut. Even then, around 2,000 were in the Swedish operations.
Big loss
During the quarter, the company made an operating loss of SEK 5.6 billion, compared with a profit of SEK 6.4 billion a year earlier. Revenue fell from SEK 86.4 billion to SEK 66.9 billion.
The situation in the Chinese market is particularly challenging, with sales halved compared with the same period last year. There is currently no clear improvement in sight for the coming quarter.
It’s bleak, and that’s why some of the cost-cutting measures we’re taking are intended to help us ride out the storm in China, says Fredrik Hansson.
Given the heavy losses, are there concerns about the company’s cash flow?
We have 32 billion in cash and 55 billion in total available liquidity, so we are very well capitalized. It’s clear that some of the measures we’re taking are intended to secure better, stronger and more positive cash flow.
Union representatives have reacted to the announcement with disappointment.
Many have felt that something has been going on, but perhaps not on this scale. The feeling is that “here we are again”. It’s clear that it is extremely difficult and frustrating, says Jörgen Olsson, chair of the Union’s club at Volvo Cars.
Shares this year
He is supported by Adrian Avdullahu, chair of the IF Metall club at Volvo Cars.
“Our members are waking up to this today. But it’s clear that there has been concern. People realize that if a company issues a profit warning, something is up,” he says.
Kristina Tullgren, chair of the Swedish Association of Graduate Engineers at Volvo Cars, calls the announcement “deeply regrettable”.
“For our members, this means another period of uncertainty after several years of recurring downsizing, reorganizations and cost-cutting programs,” she said in a written statement.
Shares in Volvo Cars, whose majority owner is the Chinese automotive conglomerate Zhejiang Geely Holding Group, have fallen by just over 50 percent on the Stockholm Stock Exchange since the start of the year.
