Volvo AB will eliminate 2,000 administrative jobs, or 1.8% of its workforce, after investments in new models and a rising krona caused a surprise drop in third-quarter profit at the Swedish truck producer.
Earnings before interest and taxes fell 18% to 2.4 billion kronor ($380 million) from 2.92 billion kronor a year earlier, Gothenburg-based Volvo said in a statement today. The job cuts are part of a strategy that Volvo, the world’s second-biggest truck maker, announced in September to generate annual cost savings of 4 billion kronor through 2015.
Volvo reported 7.5 % growth in third-quarter truck orders, lagging behind jumps of 29 percent at local competitor Scania AB and 33 % at industry leader Daimler AG.
The truckmaker, which also makes Renault-brand trucks in Europe, Mack vehicles in North America and UD models in Japan, had a workforce of 112,644 people at the end of September, including 17,216 temporary employees and consultants, the company said in its earnings report. The job cuts will affect employees at the group’s main locations in the U.S., Sweden, France and Japan, said Karin Wik, a spokeswoman.
Volvo also announced on Oct. 16 a capacity reduction, which involves shifting production among plants in different countries in a project affecting another 900 employees, including 700 in Sweden. Volvo hasn’t specified whether those workers will be dropped or transferred, saying it’s in talks with unions on their future.
by Aurel Niculescu
) - Friday, October 25th, 2013 - filed under Industry
, Sales Reports
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