Volvo will likely report a big operating loss in China for 2012 as slow sales and a costly new factory weighed on results, Swedish daily Svenska Dagbladet reported.
The carmaker, owned by Zhejiang Geely since 2010, will report a loss of between SEK2bn (US$305m) to SEK4bn (US$610m) in China, the paper said, citing sources which said the high cost of a new plant in the southwestern city of Chengdu, plus expenses related to building up a network of dealers and weak overall sales in the country, were to blame.
Go deeper with GlobalData
However, the losses in China are not unexpected after Volvo suffered a 11% fall in sales in China last year while it has been investing heavily to establish local production.
Volvo has also been cutting jobs and costs as European sales have slumped in the economic crisis.
