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Volvo Cars Predicts 2012 Operating Loss
CEO Hakan Samuelsson tells reporters it will be "very tough" for Volvo Car Group to make a profit before interest and taxes this year because of sagging sales and heavy investment.
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CEO Hakan Samuelsson tells reporters it will be "very tough" for Volvo Car Group to make a profit before interest and taxes this year because of sagging sales and heavy investment.
Volvo's operating earnings tumbled 84% year on year to 239 million kronor (€28 million) in the first six months of 2012.
The company's sales in Europe are weaker now than in the first half of this year, Samuelson notes. He adds that there are "no positive signals."
Samuelsson says he is especially dissatisfied with Volvo's flat sales in China. The company's owner, Zhejiang Geely Holding Group, hired him in October to accelerate the Swedish brand's expansion in China.
Financing from the state-owned China Development Bank that Volvo has been awaiting since April will be made available soon, according to Samuelsson. He declines to disclose the amount of the loan, which will help finance the construction of Chinese factories and development of fuel-efficient vehicles.
The CEO also says Volvo is no longer seeking a partner for small-car development.
Earlier this week the company outlined details of its planned €8.5 billion investment in new products and capacity, which will be split about evenly between Sweden and China.
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