Volvo announced it will cut production in North America after sales of its trucks saw a decline of 15% in November.
Volvo, which sells trucks under its own name as well as under the Eicher, Mack, Renault and UD Trucks brands, saw deliveries of trucks in Europe, its biggest market, fall 13% to 7,406 units and 27% to 3,510 units in North America in November. During the recent quarters, demand for trucks has dropped due to the euro zone crisis, forcing Volvo to cut production in North America.
“Concerns about the economy continued to affect the market, and a combination of stop days and rate reduction is being implemented to align production with demand,” said Volvo.
The cut in production days, as well as the “fiscal cliff” of automatic tax hikes have made the Mack brand see a sharp drop in deliveries in North America. Shipments also dropped 15% to 4,357 units in Asia and 12% to 2,252 units in South America. Handelsbanken analyst Hampus Engellau said that the production cuts and the delivery numbers are in line with analysts’ expectations. Last month Volvo sold 19,104 trucks compared with 22,440 units in November 2011.