Volvo Cars has issued a profit warning and pulled its annual guidance, citing a significant negative impact from the market downturn in China and a slower-than-expected recovery in the US. Third-quarter vehicle deliveries fell by 11 per cent year on year. The warning reflects intense competition from Chinese rivals, higher US tariffs, and rising raw-material costs linked to the Middle East conflict.
In China, cut-throat price competition and declining demand for internal-combustion-engine vehicles have pressured sales, despite a 29 per cent year-on-year growth in EV sales, which accounted for nearly one-third of total sales. Volvo, owned by China’s Geely, had previously forecast full-year growth but now faces challenges in its premium segment recovery. Shares fell more than 4 per cent in morning trading.
Klaus Zellmer, former Škoda boss, is set to replace Håkan Samuelsson as CEO by October next year. Volvo said it would take further decisive actions, including a global freeze on white-collar hiring, while noting resilience in the European market. Analyst Matthias Schmidt highlighted low EX60 electric SUV deliveries in Sweden, with only 39 units delivered in September, raising concerns about the pace of EV transition.
Source: Financial Times Companies · Summarized by HeadlinesBriefing