Volvo’s Chinese ownership and heavy overseas production footprint have put it in a uniquely challenging position in the U.S. market, but the automaker is facing significant hurdles in other countries. Yesterday, the company announced up to 3,000 layoffs as it looks to turn the situation around.
The cuts will help Volvo save around $1.89 billion and will impact 3,000 jobs in the company’s home country of Sweden, or about 15 percent of its office-based workforce. Volvo CEO Hakan Samuelsson said, “The automotive industry is in the middle of a challenging period. To address this, we must improve our cash flow generation and structurally lower our costs. At the same time, we will continue to ensure the development of the talent we need for our ambitious future.”
President Trump cooled talk about 50 percent tariffs on EU imports after talking with EU Commission President Ursula von der Leyen. Cars coming from the old world face a 25 percent tariff, plus tariffs on imported metals.
Volvo withdrew its financial projections and said it would look to cut investments in other parts of its operations globally, citing tariffs as a cause. The automaker also delayed plans to go all-electric, saying it needed to remain “pragmatic and flexible” as the industry adapts to the new reality.
[Images: Volvo]
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