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Volvocars Corp., rejects reported billion looses in China.

Thursday, 18 April 2013

We started this morning by reporting that Volvo Cars was making massive looses in its Chinese operations. Nevertheless, the Swedish Chinese owned automaker has had enough time to digest the news and came up later in the day with a full denial of that "allegation"

According to Swedish media reports, Volvo Car Corporation is finding it hard to break into the Chinese market despite other western auto brands making it big in that market.

Volvo, owned by Chinese Geely since 2010 was expected to have taken over China given that Geely is a local player but reports emerged today on the Swedish daily, Svenska Dagbladet that the company was making massive looses and that in 2012, the company will made looses of about of Skr2 and 4 billion.

The reasons for the looses have been attributed to fewer cars sold in the Chinese market, expensive new plants and a costly dealers and distribution network with in China. Therefore, operating profit in China has as such remained largely negative, sources told Svenska Dagbladet.

Volvo Car Corporation was not impressed with the news and its press officer, Per-Ake Froberg on Thursday did not want to comment on the matter. However, he returned later to the Swedish news network, TT in the afternoon and decided to say something about the issue.

"We make no loss in China," he told the news network but would not comment further.

"We feel that this has taken far too large a proportions. Anonymous sources have taken over and painted a picture of us that we do not think is true, "said Froberg.

He however referred TT to the company's the financial statements presented on May 3rd. He did not wants, for example, not to talk about the operating result which was in question. This is where the sources said that there were resounding losses last year.
By Scancomark.com Team

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