Volvo Cars said Friday it plans to cut 2,500 jobs after a sharp decline in its Chinese market weighed on third-quarter earnings.
The Swedish automaker reported an operating loss of 5.6 billion Swedish Kronor ($563.7 million) in the third quarter, down from an operating profit of 6.4 billion Swedish Kronor in the previous period.
The company cited a deteriorating environment led by “tougher” market conditions in China and the U.S., which “negatively affected free cash flow.”
Volvo Cars shares were last down 31%.
Volvo Cars shares since the beginning of the year.
The company said Volvo Cars’ revenues in China fell almost 50% year-on-year as premium brands faced “hypercompetition” from new Chinese rivals, which also put severe pressure on pricing.
Meanwhile, in the U.S., the company cited negative effects from tariffs and fewer customer incentives to buy electric cars, putting pressure on profit margins.
Volvo Cars said it is looking to cut 5 billion Swedish Kronor in costs by eliminating 2,500 jobs globally, with 2,000 of those jobs based in Sweden.
This is breaking news. Please refresh for updates.
