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Automotive Industry
The automaker said it will focus on protecting its margins, instead of pushing volumes.
Volvo Cars lowered its expectations for retail sales this year due to a growing weakness in the automotive market.
The automaker will focus on protecting margins instead of pushing volumes and therefore sees unit sales growing at as much as 8% this year, from an earlier forecast of as much as 15%, it said on 23 October 2024.
“Industry demand continues to soften and is now affecting the premium segment,” Volvo said in a statement.
The Geely-owned brand already scaled back its profit outlook last month, citing an uncertain global economy and increased tariffs on electric vehicles built in China, where it has some production.
Volkswagen, Stellantis, Aston Martin, Mercedes-Benz and BMW have all lowered their earnings expectations in recent weeks.
In September 2024, the Swedish-origin company also joined a growing roster of automakers reducing EV ambitions, abandoning a target to sell only full-electric cars by the end of the decade.
The maker of the electric EX90 and EX30 SUVs said it might need to keep some hybrid models in its portfolio amid the slowing market for battery electric cars.
Volvo’s third-quarter operating profit beat expectations on robust demand for its models with a battery.
Retail sales rose 3% in the period, to 172,849 cars, with full-electric and plug-in hybrid vehicles accounting for 48% of the total.
Volvo said it was disciplined on pricing in China, resulting in lower sales volumes in the world’s biggest auto market.
“The company’s internal cost efficiency initiative has already resulted in lower variable costs and remains a crucial focus area, and actions in this area will be accelerated,” Volvo said.