Volvo Cars swings to SEK 5.6bn Q3 operating loss, plans about 2,500 job cuts

In the third quarter, Volvo Cars’ revenues in China fell by almost 50 per cent year-on-year, to SEK 7,498 million from SEK 14,075 million in the third quarter of 2025, according to the report's regional breakdown. The company cites hypercompetition from new Chinese alternatives and severe pricing pressure there, while in the US tariffs and the end of consumer incentives for electrified cars weighed on margins.

Third-quarter EBIT came to SEK –5.6 billion, compared with SEK 6.4 billion in Q3 2025. That included SEK –0.9 billion for Volvo Cars’ share of Polestar’s second-quarter losses, with no figure shown for Q3 2025, and SEK –1.1 billion of items affecting comparability, against SEK 0.5 billion in Q3 2025. On the report's non-IFRS measure, "EBIT excl. share of income in JVs and associates and items affecting comparability", the quarter was SEK –3.7 billion, against SEK 5.8 billion in Q3 2025. This year's item is a revaluation of US CAFE credits after a retroactive change in emission legislation.

Volvo Cars said that, responding to the result, it aims to cut a further SEK 5 billion from indirect spend and variable costs, on top of earlier cost programmes, and that this will remove about 2,500 jobs worldwide, 2,000 of them in Sweden, by ending consultant contracts, through natural attrition and with targeted exit packages, according to its results release. The company expects the full financial effect by the end of 2027, when it says indirect spend will be almost 25% below the 2024 level. The interim report also records a restructuring programme decided in October, expected to cost about SEK 0.6 billion, with a provision to be booked in the fourth quarter.

'Europe’s car market has been more stable and was therefore the sole positive contributor to our operational performance', according to the chief executive's letter, signed by Håkan Samuelsson, President and CEO. Fully electric models took 45% of Volvo Cars' sales there in the third quarter, and the EX60 has drawn more than 50,000 European orders. The group plans 13 new cars by the end of 2030, three of them to be revealed in 2027, and will start building the XC60 in Charleston in the first quarter of that year. Klaus Zellmer, named on 20 September as the next chief executive, is due to succeed Samuelsson no later than 1 October 2027.

Nine-month revenue fell to SEK 217.2 billion from SEK 262.9 billion in Jan–Sep 2025. Nine-month EBIT was SEK –3.2 billion, a margin of –1.5%, against SEK –1.6 billion and –0.6% in Jan–Sep 2025. On the same non-IFRS basis, it was SEK –1.6 billion, against SEK 10.3 billion in Jan–Sep 2025. Items affecting comparability totalled SEK –1.1 billion, against SEK –12.4 billion in Jan–Sep 2025, which included an impairment charge for the EX90 and ES90 platform of SEK –11.4 billion. Operating and investing cash flow for the nine months was an outflow of SEK 24.1 billion, which the company attributes mainly to working capital, including a planned inventory build-up.