Volvo Cars announced on Monday a new round of layoffs affecting “around 3,000” employees — or 15% of its global workforce — as part of its recently launched “cost and cash action plan.”
The company said in a statement that it aims to “build a stronger and even more resilient Volvo Cars,” citing “considerable challenges” in the automotive industry.
The layoffs will primarily affect “office-based positions in Sweden and will represent around 15% of the total office-based workforce globally.”
As of the end of 2024, Volvo Cars had 42,600 full time employees.
From the 3,000 positions cut, 1,200 are located in Sweden “and the remaining in other global markets.”
The brand said that “the company will reduce around 1,000 positions currently filled by consultants,” as part of the SEK 18 billion ($1.89 billion) action plan which includes “the creation of a leaner, more efficient organisation with a structurally lower cost base.”
The company announced in early May that it was suspending its “financial guidance for 2025 and 2026,” citing an uncertain environment.
“The actions announced today have been difficult decisions,” the recently appointed CEO Håkan Samuelsson, who replaced former CEO Jim Rowan in April, stated. “But they are important steps as we build a stronger and even more resilient Volvo Cars.”
Samuelsson urged this month that “some kind of trade deal with the U.S. Otherwise, this is of course going to be very difficult for the business” in the country”
Volvo said it estimates that “it will incur a one-time restructuring cost of up to SEK 1.5 billion [$157 million],” which will affect the company’s second quarter results and show its effects “from the fourth quarter of 2025 and into 2026.”
The company said on Monday that more details will be provided at the upcoming earnings conference call scheduled for July 17.
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.”
Earlier this month, the Geely-backed brand had announced a 5% reduction at its South Carolina plant affecting 125 workers.
Shortly after the announcement, Volvo shares are trading nearly 2% higher in the Stockholm Exchange at 269.70 SEK.
