Volvo AB, which is at the moment the world’s second biggest heavy truck maker has reported its first quarter operating profit was up almost fivefold form last year.
The gains have been aided by the manufacturer’s cut on production, which is part of a plan to meet new cost-savings goals by 2015. The Swedish company said in a statement that earnings before interest and taxes increased to 2.27 billion kronor ($345 million) from 482 million kronor in 2013, beating analysts estimates.
“The measures we are implementing to increase the group’s profitability are running according to plan and start to have a positive impact on our gross margin and costs,” said Chief Executive Officer Olof Persson. “But there is still more work to do in terms of cost reductions, and this is the group’s main focus for 2014.”
The company also revealed it closed this quarter a truck-production line and a component facility, as it strives to meet a program target that would see each year until the end of 2015 cost savings of 4 billion kronor.
The CEO intends to make Volvo AB the most profitable among truck makers – reorganizing Volvo and Renault brands’ production in Europe, expanding to new markets and making administrative job cuts.