Volvo Cars has stopped external hiring for office jobs worldwide and paused internal recruitment, Automotive Newsreported, as the Geely-controlled carmaker’s net cash has fallen by more than 60% this year and its shares trade at their lowest since listing.
“In practice, this means we are stopping external hiring and taking a more restrictive approach to external spending across the company,” an internal memo said, according to the trade publication.
The memo said the new rules cover recruitment, contingent workers and bought services, and are meant to “support our affordability ambitions.”
Internal recruitment is paused while the company reviews its approach to talent development, career opportunities and job rotation, according to the report.
Factories and related operations, including purchasing and logistics, are not affected.
A Volvo Cars spokesperson declined to comment to Automotive News. The company has about 20,000 white-collar employees worldwide, the publication said.
Volvo Cars’ B shares fell as much as 2.8% in Stockholm on Tuesday morning to SEK 15.58, the lowest since the company listed in October 2021.
They were trading 2.4% lower at SEK 15.63 at 11:20 a.m. local time. The shares have lost about 49% this year, against a 2025 closing price of SEK 30.70.
Cash Falling
Net cash fell to SEK 10.1 billion ($1.01 billion) at the end of June from SEK 26.9 billion ($2.69 billion) at the end of 2025, the company’s second-quarter report shows.
It said the drop was “primarily driven by working capital.”
Cash flow from operating and investing activities was negative SEK 10.0 billion in the first quarter and negative SEK 5.2 billion ($520 million) in the second.
Volvo Cars attributed most of the second-quarter outflow to a “planned inventory build-up” at its Torslanda plant for the new EX60.
It expects “a strong positive free cash flow in the late second half of the year, ending the full year approximately at break even.”
Liquidity, including SEK 22.2 billion ($2.22 billion) of undrawn credit lines, was SEK 63.6 billion ($6.36 billion) at the end of June.
S&P rates Volvo Car AB at BB+ and Moody’s at Ba1, both one notch below investment grade and both with a negative outlook, according to the company.
Thin Margins
Operating income was SEK 0.8 billion ($80 million) in the second quarter, a margin of 1.1%.
Excluding items affecting comparability, that was down 72% from SEK 2.9 billion a year earlier, when the margin was 3.1%.
The company cited sales mix and pricing, lower wholesale volume and lower revenue from emission credits, which fell to SEK 0.5 billion from SEK 1.6 billion.
Revenue fell 17% to SEK 77.7 billion ($7.76 billion).
Volvo Cars set a long-term target of an operating margin “beyond 8%” on September 17, alongside 13 new models by 2030, without giving a date for reaching it.
Sales Still Falling
Retail sales fell 7.4% to 148,239 cars in the three months to August, the steepest drop in four months.
“Given the challenging market conditions in China and the US, we are prioritising protecting transaction prices over volume growth,” Chief Commercial Officer Erik Severinson said in the company’s release.
First-half sales fell 8% to 324,817.
In the second quarter, sales in Greater China fell 35%, while Europe and the rest of the world rose 2% and the Americas 4%.
Fully electric cars made up 29% of sales in the three months to August. Volvo Cars has promised “significantly stronger sales” in the second half than in the first.
Third Round of Cuts
The freeze follows two earlier moves on office costs.
Volvo Cars announced in May 2025 that it would cut about 3,000 jobs, mostly white-collar, as part of an SEK 18 billion ($1.8 billion) cost-and-cash plan.
Its headcount is about 3,000 positions lower than in the first half of 2025, Chief Executive Officer Håkan Samuelsson said in July.
The company said on August 31 that it would close its Stockholm office on March 1, 2027, moving the work of about 450 employees to its Gothenburg headquarters.
It had delivered SEK 5 billion ($500 million) of targeted full-year savings in indirect and variable costs by June, “six months ahead of time,” Samuelsson said.
Samuelsson’s two-year contract ends in April. Volvo Cars named Škoda Chief Executive Officer Klaus Zellmer as his successor on September 20, with a start “no later than 1 October 2027.”
The company reports third-quarter results on October 23.
