Mikael Sjoberg | Bloomberg | Getty Photographs
Sweden-based automaker Volvo Automobiles on Monday mentioned it might reduce round 3,000 jobs as a part of a significant cost-cutting drive.
The transfer comes after the corporate, which is owned by China’s Geely Holding, introduced an 18 billion Swedish kronor ($1.89 billion) value and money motion plan late final month.
Volvo Automobiles mentioned the three,000 job cuts would primarily influence office-based positions in Sweden and signify round 15% of the agency’s complete office-based workforce.
“The actions introduced as we speak have been tough selections, however they’re essential steps as we construct a stronger and much more resilient Volvo Automobiles,” Håkan Samuelsson, Volvo Automobiles president and CEO, mentioned in a press release.
“The automotive business is in the course of a difficult interval. To handle this, we should enhance our money stream era and structurally decrease our prices. On the identical time, we are going to proceed to make sure the event of the expertise we want for our formidable future,” Samuelsson mentioned.
As a part of the redundancies, the corporate mentioned it might scale back round 1,000 positions presently held by consultants, principally in Sweden, roughly 1,200 workers in Sweden and the remaining in different world markets.
When the motion plan was launched on April 29, Volvo Automobiles mentioned this system would come with reductions in investments and redundancies at its operations throughout the globe. The corporate additionally withdrew its monetary steering for each 2025 and 2026, citing tariff stress on the automotive sector.
Commerce warfare dangers
Uncertainty over commerce tariffs is anticipated to have a profound influence on the automobile business, notably given the excessive globalization of provide chains and the heavy reliance on manufacturing operations throughout North America.
U.S. President Donald Trump on Friday threatened to impose 50% tariffs on imports from the European Union from the beginning of June, prompting Europe’s auto index to fall sharply.
The U.S. president has since watered down the menace, saying on Sunday that he had agreed to push the rollout of the punitive import duties again to July 9, following a name with EU Fee President Ursula von der Leyen.
The EU already faces 25% U.S. import tariffs on autos, metal and aluminum and so-called “reciprocal” tariffs of 10% for many different items.
Volvo Automobiles mentioned the measures have been vital to make sure it may possibly ship on its long-term technique, including that it stays agency on its ambition to develop into a totally electrical automobile firm.
A pacesetter within the electrical car (EV) transition, Volvo Automobiles introduced plans in September to drop its near-term objective of promoting solely EVs, citing a have to be “pragmatic and versatile” amid altering market situations and cooling demand.
