Volvo Cars expects flat sales in 2013 due to weak demand

Article by Anita Panait, on December 19, 2012

Volvo Cars expect to post roughly flat sales in 2013 but does not currently intend to reduce its production workforce, chief executive Hakan Samuelsson told Swedish daily Dagens Industri in an interview. Asked by the daily if Volvo was expecting to sell between 400,000 and 410,000 cars next year, which is slightly below this year's level, Samuelsson responded by saying that they are “expecting something in that order of magnitude."

Volvo’s CEO told the business daily that that is the level where they see the market bottoming out. Volvo sold around 450,000 cars in 2011 and eyes to sell about 800,000 units in 2020. However, the company’s sales for 2012 have been heavily undermined by weak demand.

Volvo was forced to reduce output and workforce at its main production sites in western Sweden and in Ghent, Belgium, as the carmaker has to cope with dwindling market demand in Europe and lackluster sales of Volvos in China.

Samuelsson told Dagens Industri that while scattered measures to reduce costs for white-collar were being discussed, there are no further cuts planned for production staff. He added that Volvo has basically let go of all temporary employees in Sweden and in Belgium.

According to Volvo’s chief executive, the carmaker had a list of savings measures to implement that would allow the auto company to meet the soft market demand and enable it to achieve break-even. Earlier this month, Samuelsson remarked that it would be difficult to reach break-even at the operating level in 2012.

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Topics: volvo

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