Volvo Cars announced it will cut 2,500 additional jobs, mostly in its home market of Sweden, after reporting a far bigger-than-expected third-quarter operating loss. The announcement sent the carmaker’s shares plunging 24 per cent to a record low on Friday.
The latest measures will affect about 6 per cent of Volvo’s workforce through the termination of consultant contracts, natural attrition and targeted exit packages, the company said. These cuts come on top of 3,000 jobs eliminated earlier. CEO Hakan Samuelsson told Reuters the reductions should be completed by mid-2027, though he did not rule out further measures.
The automaker reported an operating loss of 3.7 billion Swedish crowns, $373 million, in the quarter, compared with a profit of 5.8 billion crowns a year earlier. Volvo also burned through 8.9 billion Swedish crowns in cash during the quarter, double the cash burn from the same period in 2025. Its gross margin fell to 14.7 per cent from 20.4 per cent a year earlier, and quarterly revenue fell nearly 50 per cent.
“The third quarter of 2026 was very disappointing and reflects a year that has become far more challenging than originally anticipated. Our ongoing turnaround plan therefore needs a decisive reinforcement,” Samuelsson said.
The Swedish carmaker, majority-owned by China’s Geely Holding, is struggling with uneven demand for electric vehicles, mounting tariff pressures and tough market conditions in China. Samuelsson noted the company needs to trim another 5 billion crowns in costs.
Volvo’s struggles reflect a broader squeeze on European automakers from weak demand, intense competition from Chinese rivals and excess factory capacity. The delays in ramping up its new EX60 electric SUV have also hampered its turnaround efforts. Former Skoda boss Klaus Zellmer is set to succeed Samuelsson next year to lead the company through its restructuring.
