Volvo to cut production at its Ghent plant in Belgium from 2013 image

Volvo Car Corporation will cut production at its plant in Ghent, Belgium, and will not renew contracts for 300 staff from employment agencies as of 2013.

Volvo, which was bought by Zhejiang Geely Holding Group in 2010 from Ford Motor Company, is affected by slowing demand for its cars over the past year. Only last week, the company replaced its top executive in an attempt to restore growth. “We have had a very positive trend during a number of years, with 2011 as a record year. Now we see customer demand declining and we need to rebalance our production output,” the company said in a statement.

The company announced the line speed at the Ghent plant will be lowered to 54 cars per hour from a previous 59 cars per hour, starting in 2013. Volvo made most of its 449,000 cars sold in 2011 at the Ghent plant. The Belgium facility builds some of Volvo’s most important models: the S60, XC60, C30 and V40. The company employs 5,200 people in Ghent.

The announcement comes after a similar decision announced on October 15, when Volvo said it would halt production for a week at its plant in Torslanda, Sweden, starting October 29, as demand continues to fall in Europe.