Volvo returned to profit in 2013 image

Volvo Car Corp Chief Executive Hakan Samuelsson said the Swedish automaker returned to operational profitability in the year just ended after fixing its business in China and making cost cuts.

Volvo is expected to announce its financial results for the year in March. For the first half of 2013, the company posted an operating loss of 577 million SEK ($88.71 million), according to a company spokesman.

“Our target was to break even… but I can declare already today that… we are back in the black, which is extremely positive,” Samuelsson told Reuters in an interview on the sidelines of the Detroit auto show.

Samuelsson attributed the turnaround to Volvo’s successful restructuring of its distribution network in China, which led to a 46 % boost last year in volume in that country to 61,146 vehicles, as well as to an overhauling of its cost structure globally.

Because of its aggressive cost cuts, Volvo was able to make money even though it posted only modest gains in global sales volume in 2013, Samuelsson said. Volvo sold a total of 427,840 vehicles last year, up 1.4 % from 2012.

Samuelsson said the company, which was purchased by Zhejiang Geely Holding Group from Ford in 2010, hopes to regain growth momentum with some key new products. Those new models include the significantly redesigned XC-90 crossover vehicle, which he said should be unveiled later this year and start hitting show rooms in the United States and elsewhere around the start of 2015.

Via Reuters