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Chinese owned SwedishVolvocars Corp., Reports Billion Loss

Friday, 03 May 2013
Economic situation in Europe is to be blamed for the massive looses Volvo Cars reported last year, a loss of almost one billion. And the loss would have been even greater if the company sold off its old model XC-90 to its Chinese owner.

Car sales volume in Europe has been falling as manufacturers are reporting billions in losses. And when Europe is its major market so it is thought that strikes hard against the result.

Today, the company reported a loss before tax of Skr915 million for 2012.That is a decline of over two billion Krona compared with the previous year.

And the result could have been even worse. For the Annual Report writes that Volvo Cars will would sold out technology of  the old car model XC-90 to a company within the family owners,  Geely Holding. Had the affair not been carried out Volvo's results would have been Skr 590 million weaker.

Volvo Cars has already pulled the handbrake in many of its operations in order to regulate to the looses. We reported back in February based on media reports in Sweden that the company has launched another savings package of Skr1.5 billion, which meant that 1,000 people would loose their jobs in the company.

Sales declined last year by 6.1 percent to 422,000 cars and Volvo is now adapting ist system  to meet a zero result at the same level.

"The competitive situation is likely to persist in 2013," writes the company's CEO Hakan Samuelsson in a comment. He expects the company to make a break this year and that Volvo Cars will be able to keep the sales up by the announced facelift on a series of old cars which was announced recently.

The problem for Volvo is that the company is now investing heavily to develop a series of completely new models and engines to begin launching in Fall. And that means that the economy will be very strained in the coming years.

"We are in the midst of what may be the greatest transformation in its history," says Håkan Samuelsson in a press release.
by Scancomark.com Team


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