Marie Mannes and Anna Ringstrom
2 min read
In This Article:
By Marie Mannes and Anna Ringstrom
STOCKHOLM (Reuters) -Volvo Cars will cut 3,000 mostly white-collar jobs as part of a restructuring announced last month as it grapples with high costs, a slowdown in electric vehicle demand and trade uncertainty, it said on Monday.
The layoffs come as the Swedish automaker tries to resurrect its rock-bottom share price and drum up better demand for its cars by restructuring part of its business and cutting costs.
CEO Hakan Samuelsson, who was recently brought back to the role after heading the company for a decade until 2022, unveiled a programme in April to slash costs by 18 billion Swedish crowns ($1.9 billion), including a substantial cut to its white-collar staff, who make up 40% of its workforce.
"It's white collar in almost all areas, including R&D, communication, human resources," Samuelsson told Reuters on Friday, "So it's everywhere, and it's a considerable reduction."
"I think it will be very healthy, and will save us money and give space for people to (take on) bigger responsibilities."
Volvo Cars' new CFO Fredrik Hansson told Reuters that while all of its departments and locations would be impacted, most of the redundancies will happen in Gothenburg.
"It's tailored to make us structurally more efficient, and then how that plays out might vary a bit depending on the area. But no stone is left unturned," Hansson said.
The layoffs represent around 15% of the company's office staff, Volvo Cars said in a statement, and would incur a one-time restructuring cost of 1.5 billion crowns.
With most of its production based in Europe and China, Volvo Cars is more exposed to new U.S. tariffs than many of its European rivals, and has said it could become impossible to export its most affordable cars to the U.S.
The company said in a press release that it would finalise a new structural set-up by the autumn of this year.
Handelsbanken analyst Hampus Engellau said the number of staff to be laid off was in line with expectations, and that the company's move to streamline its operations was positive.
The group withdrew its financial guidance as it announced its cost cuts last month, pointing to unpredictable markets amid weaker consumer confidence and trade tariffs causing turmoil in the global auto industry.
On Friday, U.S. President Donald Trump threatened to impose a 50% tariff on imports from the European Union from June 1, but on Monday he backed away from that date, restoring a July 9 deadline to allow for talks between Washington and Brussels.
