The Swedish manufacturer of heavy vehicles, Volvo, reported a pre-tax loss of 2.5 billion kronor (303 million dollars) in the fourth quarter of 2008, during which there was also an 82 percent decline in new truck orders.
For comparison, in the same business quarter of 2007, the Volvo Group, which does not include the automotive business owned by Ford, achieved a pre-tax profit of 5.6 billion kronor. Net revenues decreased by nine percent in the fourth quarter to 76.9 billion kronor, while net profit weakened from 4.1 billion to 1.3 billion kronor.
In the entire year of 2008, revenues increased by six percent to 303 billion kronor, while pre-tax profit weakened by 35 percent to 14 billion kronor. In the fourth quarter, the number of new truck orders plummeted year-on-year from 76,417 to 13,678 vehicles, Volvo reported, noting that the decline in demand was recorded in all key markets except Asia. The number of delivered trucks decreased year-on-year by 22 percent to 59,528 units.
"It is difficult to assess what the trend will be in 2009, but we do not expect a recovery in demand in the first half of the year," said CEO Leif Johansson. The Volvo Group sells trucks and heavy vehicles, as well as buses and construction equipment, and includes parts of the Volvo Aero and Volvo Penta businesses. At the end of last year, the group employed 101,381 workers, compared to 101,698 at the end of the previous year. In 2008 and 2009, the layoff of 16,255 employees and consultants is planned. (H)
