Volvo Cars has started laying off workers in China as part of its 15% workforce cut announced in late May, according to a report by local media outlet Jiemian News on Monday.
The carmaker had announced plans to cut 3,000 jobs as part of its recently launched “cost and cash action plan.”
The global layoffs mostly concern administrative and strategic departments, primarily office-based positions in Sweden — representing around 15% of the “total office-based workforce globally,” according to the brand.
Layoffs in China are allegedly affecting the company’s R&D center in Shanghai, the Volvo Cars Technology Center in Jiading. However, contacted by the media outlet, the brand did not confirm nor deny the report.
A Volvo employee told Jiemian News that the impact of the layoffs varies by department, with some teams losing as few as 10% of their staff, while others could see cuts as high as 70%.
For some employees, the entire layoff process was completed in just three days: they were notified on June 30, interviewed in batches shortly after, and the process was finalized by July 2.
According to sources in the company, Volvo‘s competitiveness in China has declined due to a slower shift toward electric vehicles and a delayed rollout of an updated product lineup.
Last month, Volvo Cars sold 62,858 vehicles, the fourth consecutive month that the company’s sales have dropped by more than 10% year over year.
Despite battery electric vehicles representing 22% of the total vehicles sold, global EV sales fell 26% compared to the same month last year.
In China, sales of fully electric models plunged 69% to only 126 units.
From the nearly 62,900 vehicles sold globally, 13,569 were sold in China — meaning that 21.6% of Volvo‘s global sales were in the Asian country. However, sales in China have dropped 3% from a year ago.
As of the end of 2024, Volvo Cars had 42,600 full time employees globally.
The company announced in early May that “given external developments and increased uncertainties”, it is “no longer providing financial guidance for 2025 and 2026.”
The Sweden-based automaker intends to “complete the structural changes during the autumn of 2025,” as it is “firm on its ambition of becoming a fully electric car company.”
However, in September last year, the company revised its earlier target of being 100% electric by 2030. It now aims for electric vehicles to make up 90% of its sales by that year.
In June, Volvo teased the fully electric version of its best-seller, the EX60 — set to be unveiled in “early 2026.”
Late last month, Volvo was spotted testing a camouflaged electric sedan on public roads in Gothenburg, according to a picture obtained by EV.
While the company has not commented on the vehicle’s identity, the model is expected to adopt its 800-volt electrical architecture, in line with the direction set by the recently unveiled ES90.
