Sweden-based car maker Volvo Cars says it will cut around 3,000 jobs as part of its cost-cutting measures.
Last month, Volvo Cars, which is owned by Chinese group Geely Holding, announced an 18 billion Swedish kronor ($1.9bn; £1.4bn) “action plan” shake-up of the business.
The chief executive of Volvo Cars, Håkan Samuelsson, pointed to the “challenging period” faced by the industry as a reason for the layoffs.
Volvo Cars has its main headquarters and development offices in Gothenburg, Sweden.
In April, BYD outsold Elon Musk’s Tesla in Europe for the first time, according to car industry research firm Jato Dynamics.
The Swedish automaker Volvo Cars has announced that, as part of its cost-cutting efforts, it will eliminate about 3,000 jobs.
About 15% of the company’s white-collar employees in Sweden will be affected by the layoffs, according to the company.
The Chinese conglomerate Geely Holding owns Volvo Cars, which last month announced an “action plan” to restructure the company for 18 billion Swedish kronor ($1.9bn; £1.4bn).
President Donald Trump’s 25% tariffs on imported automobiles, rising material costs, and slower sales in Europe are just a few of the significant issues the global auto industry is currently dealing with.
Håkan Samuelsson, the CEO of Volvo Cars, attributed the layoffs to the “challenging period” encountered by the industry.
He said in a statement, “The decisions made today have been tough, but they are meaningful steps as we build a stronger and even more resilient Volvo Cars.”.
The company reported earlier this month that its global sales for April decreased by 11% from the same time last year.
Gothenburg, Sweden, is home to Volvo Cars’ main office and development facilities. Its main manufacturing facilities are located in China, Sweden, Belgium, and the US.
The US automaker Ford sold the business to Geely of China in 2010.
In 2021, Volvo announced that by 2030, all of its vehicles would be electric. A number of factors, including “additional uncertainties created by recent tariffs on EVs in various markets,” caused it to scale back that ambition last year.
Nissan, a Japanese automaker, announced earlier this month that it would close seven factories and lay off an additional 11,000 workers worldwide as it restructures its operations in the face of poor sales.
Earnings have suffered due to declining sales in China and steep discounts in the US, the company’s two largest markets; additionally, a proposed merger with Honda and Mitsubishi fell through in February.
With these most recent reductions, the company has now announced roughly 20,000 layoffs in the last year, which represents 15% of its workforce.
As an illustration of the fierce competition among automakers, Chinese electric vehicle behemoth BYD declared over the weekend that it would lower the cost of over 20 of its models.
The Seagull EV, its cheapest vehicle, is now only 55,800 yuan ($7,745; £5,700) thanks to the change.
Changan, which is owned by the Chinese government, and Leapmotor, which is supported by Stellantis, the owner of Chrysler, responded by announcing price reductions of their own.
According to auto industry research firm Jato Dynamics, BYD initially outsold Elon Musk’s Tesla in Europe in April.
