Volvo Cars to slash 3,000 jobs in white-collar – Business News
Volvo Cars will cut 3,000 principally white-collar jobs as half of a restructuring introduced final month because it grapples with high prices, a slowdown in electric vehicle demand and commerce uncertainty, it mentioned on Monday.
The layoffs come because the Swedish automaker tries to resurrect its rock-bottom share price and drum up higher demand for its automobiles by restructuring half of its business and reducing prices.
CEO Hakan Samuelsson, who was lately introduced back to the function after heading the company for a decade till 2022, unveiled a program in April to slash prices by 18 billion Swedish crowns ($1.9 billion), together with a substantial cut to its white-collar employees, who make up 40% of its workforce.
The layoffs at Volvo Cars are half of a restructuring introduced final month, the company mentioned. AFP by way of Getty Images
“It’s white collar in almost all areas, including R&D, communication, human resources,” Samuelsson instructed 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, instructed Reuters that whereas all of its departments and places could be impacted, most of the redundancies will occur 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 mentioned.
The layoffs symbolize round 15% of the company’s workplace employees, Volvo Cars mentioned in a assertion, and would incur a one-time restructuring price of 1.5 billion crowns.
Volvo Cars is more uncovered to new US tariffs than many of its European opponents. Christopher Sadowski
With most of its manufacturing primarily based in Europe and China, Volvo Cars is more uncovered to new US tariffs than many of its European rivals, and has mentioned it may change into unattainable to export its most inexpensive automobiles to the US.
The company mentioned in a press release that it could finalize a new structural set-up by the autumn of this yr.
Handelsbanken analyst Hampus Engellau mentioned the quantity of employees to be laid off was in line with expectations, and that the company’s transfer to streamline its operations was optimistic.
Volvo Cars withdrew its steerage final month. AFP by way of Getty Images
The group withdrew its financial steerage because it introduced its price cuts final month, pointing to unpredictable markets amid weaker shopper confidence and commerce tariffs inflicting turmoil in the worldwide auto industry.
On Friday, President Trump threatened to impose a 50% tariff on imports from the European Union from June 1, however on Monday he backed away from that date, restoring a July 9 deadline to permit for talks between Washington and Brussels.
