Volvo hit by collapse in truck demand
Swedish group Volvo, the world’s second-largest truck maker by sales, posted a second consecutive quarterly loss on Friday after a collapse in demand due to the financial crisis.
The Gothenburg-based company posted a net loss of 4,23-billion Swedish kronor ($514-million) for the three months ended March 31, down from a profit of 4,20-billion kronor a year earlier.
The loss was almost double the amount forecast by analysts in a poll conducted by Dow Jones Newswires/FactSet and shares in the group fell 9,3% to 49,90 kronor at the start of trading.
“Demand weakened sharply in all markets during the first quarter,” chief executive Leif Johansson said in a statement, adding that the company was slashing costs in response to a fall in demand.
Volvo announced 1 500 job cuts on Wednesday.
Revenue fell 27% to 56-billion kronor from 76,56-billion in the same period last year. The group swung to an operating loss of 4,53-billion kronor, from a 6,49-billion-kronor profit last year.
Order intake for trucks “continued to be very weak” in the quarter, Volvo said. It said the net order intake, which takes into account cancellations, plunged 65 percent compared to the first quarter of 2008.
In Europe, Volvo’s biggest truck market, net orders for trucks dropped 71 percent to 7,494 vehicles.
In Asia, the second-biggest market, net orders fell 70 percent to 5,712 trucks, and in North America they fell 49 percent to 2,869.—AFP