Swedish truck and construction equipment maker Volvo AB reported disappointing third-quarter results.
According to the company, in Q3 2024, its operating income was 14.1 billion SEK (kronor), a 27% year-over-year drop compared to the 19.3 billion kronor reported in the same period last year.
Volvo AB said income was impacted by lower sales in its trucks and construction equipment segments, with a slowdown in freight and construction in critical regions significantly affecting performance.
Volvo AB Chief Executive Martin Lundstedt noted, “Demand for construction equipment has slowed down, especially in Europe.”
Net sales in construction equipment fell by 23% to 18.8 billion kronor. In Europe, Volvo AB’s construction equipment sales fell by 20%. The results were a bit worse in North America, where construction equipment sales plunged by 34%.
Volvo has decreased production volumes to adjust to current demand and reduce dealer inventories to address these trends.
Volvo AB’s electric truck sales dropped by 4% year-over-year. However, the company is committed to expanding its electric lineup. Next year the company will launch a new long-range FH Electric. This particular model will have a 600km range — which will allow for longer routes.
Despite the disappointing results, the company believes that the adoption of electric trucks will increase with government incentives and infrastructure improvements.
Volvo AB has achieved 49.3% of the electric heavy-duty truck market in Europe. Its FH Electric may help it take more of the market.
Lundstedt remains optimistic about the company’s ability to push forward, emphasizing investment in electrification and energy improvements.
“We continued to generate good profits on the lower sales volumes with an adjusted operating income of SEK 14.1 billion (19.3) and a margin of 12.0% (14.4) thanks to hard work by our colleagues and business partners,” Lundstedt commented.
Adding: “We are on a steady improvement journey on our road to net-zero and we continue to invest considerable resources in R&D into our products and solutions.”
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