Volvo Cars has announced a restructuring initiative that will see around 3,000 jobs cut in an effort to address high costs, slowing electric vehicle demand, and trade uncertainties. The Geely-owned automaker is aiming to improve its share price and boost demand by restructuring operations and reducing expenses.
The action plan includes cost reductions of Skr18bn ($1.9bn) and will involve the reduction of 1,000 consultant roles mainly in Sweden, as well as 1,200 employee positions across the company’s global operations. These layoffs will affect approximately 15% of the company’s office staff worldwide, with a one-time restructuring cost of Skr1.5bn. The new structural setup is expected to be finalized by autumn this year.
Volvo Cars President and CEO Håkan Samuelsson stated, “The actions announced today have been difficult decisions, but they are important steps as we build a stronger and more resilient Volvo Cars. The automotive industry is facing challenges, and we must improve our cash flow generation and lower our costs while developing the talent needed for our ambitious future.”
In 2024, Volvo Car Group achieved a record-breaking core operating profit of Skr27bn, with revenue reaching an all-time high of Skr400.2bn and global sales of 763,389 cars. The company employed nearly 42,600 full-time employees as of December 2024.
Volvo Cars is on a path to becoming a fully electric car company, with its electric car lineup being the fastest-growing market segment. The company’s commitment to sustainability and innovation is evident in its strategic decisions and focus on future growth.
As Volvo Cars navigates the changing landscape of the automotive industry, the restructuring initiative aims to position the company for long-term success and sustainability. By streamlining operations, reducing costs, and focusing on electric vehicle development, Volvo Cars is poised to continue its legacy of innovation and leadership in the global automotive market.
