Volvo announces job cuts worldwide

The Swedish car manufacturer Volvo, owned by the Chinese company Geely since 2010, announced on Friday, October 23, that it will eliminate 2,500 jobs globally, with 2,000 of those positions in Sweden by the end of 2027. The move is intended to help the company cope with increasing global competition and financial challenges.

CEO cites external pressures

Volvo's CEO, Håkan Samuelsson, stated in a press release that the decision was driven by "strong external pressures," including deglobalization, heightened competition, and the impact of climate change on the automotive industry. These factors have contributed to a difficult business environment for the company.

Volvo reports significant financial loss

The company reported a net loss of 5.7 billion Swedish crowns (approximately 513 million euros) for the period, compared to a net profit of 4.5 billion Swedish crowns the previous year. Revenue for the same period was 66.9 billion Swedish crowns (6 billion euros), a 23% decline from the previous year.

Cost-cutting measures to be implemented

Volvo plans to reduce its indirect expenses and variable costs by 5 billion Swedish crowns, in addition to other cost-saving initiatives already in place. These measures are expected to result in a nearly 25% reduction in indirect expenses by the end of 2027 compared to the 2024 fiscal year.

Weak performance in key markets

The company attributed its poor performance to deteriorating conditions in major markets, particularly China and the United States. In China, Volvo faces intense competition from new local players, which has led to significant pressure on pricing and a nearly 50% drop in revenue year-on-year.

Future plans for China market

Despite the challenges, Volvo intends to continue its development in China. By mid-2027, the company plans to unveil and begin production of two models from a series of six vehicles specifically designed for the Chinese market. These will be developed using Chinese technological architecture and advanced ADAS (advanced driver-assistance systems) to enhance competitiveness.

Struggles in the United States

In the United States, Volvo is dealing with the impact of tariffs and the removal of incentives for purchasing electric vehicles, which have negatively affected its profit margins. The company sold 710,000 cars globally in 2025, with 46% being electrified vehicles, but it has abandoned its goal of selling only electric vehicles by 2030.

Volvo's global manufacturing sites

Volvo's headquarters and main factories are located in Gothenburg, Sweden, as well as in Ghent, Belgium; South Carolina, United States; and Chengdu, Daqing, and Taizhou in China. These facilities support the company's global operations and production of vehicles for various markets.