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Sweden-based carmaker Volvo Cars said on Friday it would cut about 2,500 jobs worldwide, as US tariffs and strong competition from local brands in China pushed it into a third-quarter loss.
The company, majority-owned by Chinese group Geely, reported revenue of 66.9 billion kronor (€6bn) for the third quarter, down nearly 23% from the same period last year.
It swung to a net loss of 5.7 billion kronor (€513mn) for the quarter from a net profit of 4.5 billion kronor (€405mn) a year earlier.
"We continue to operate in a very tough environment with strong external challenges: de-globalisation, hypercompetition and climate change," chief executive Håkan Samuelsson said in a statement.
In response, the company announced an additional 5-billion-kronor (€450mn) savings plan, on top of its earlier cost-cutting programmes. It said the new measures would lead to about 2,000 job cuts in Sweden and 500 more elsewhere, by ending consultant contracts, through natural attrition and through targeted exit packages for employees.
The company expects the full financial effects of these measures by the end of 2027.
The company, which had bet heavily on electric vehicles, said the removal of consumer incentives for fully electric cars and plug-in hybrids in the United States under President Donald Trump had also hit its margins.
In 2024, Volvo Cars dropped a plan to sell only fully electric cars by 2030.
"We are convinced that we have the right long-term strategy addressing these challenges. However, in the short term, with severely challenged volumes, we need to reinforce our turnaround plan with additional decisive actions, lowering our break-even point and improving cash flows to make us more resilient," Samuelsson said.
Struggling along with other European carmakers in the face of a difficult global landscape, Volvo Cars last year announced an 18-billion-kronor (€1.62bn) cost-cutting plan. That plan included around 3,000 job cuts worldwide.
The company said in September that Škoda Auto CEO Klaus Zellmer would replace Samuelsson no later than 1 October 2027.