Volvo Group – owner of truck brands Volvo Trucks, Renault Trucks, Nissan Diesel and Mack – posted its biggest-ever quarterly loss on Tuesday as write-offs amounting to more than SKR3bn dented profitability.
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The world’s second-biggest truck maker said it made a net loss of SKR5.57bn ($US722m, EUR507m) in the second quarter from April to June, down from a net profit of SKR5.15bn a year ago.
Credit losses, personnel cutbacks and the costs of a deal struck with the United Auto Workers Union over healthcare increased losses by SKR3.2bn, Volvo said in a statement.
Volvo chief executive Leif Johansson said the company was also hit by weakening demand for its heavy goods and buses.
“The second quarter of 2009 remained difficult in terms of earnings in the wake of the exceptionally rapid decline in demand that followed the crisis in the financial system,” Johansson said in the earnings statement.
He said that the truck market “remains weak” in Volvo’s key markets of Europe, North America and Japan and reiterated the company’s industry forecast for the rest of the year.
“We maintain our assessment that the total European market for heavy trucks will be at least halved in 2009 compared with 2008 and that the North American will decline by 30% to 40%,” he said in the statement.
Volvo’s net sales fell by a third year on year in the second quarter.
