Volvo Reduces Workforce Due to Economic Challenges
Despite a 6% sales growth in the USA (64,680 cars in the first half of the year), Volvo Cars has announced a 15% reduction in its global workforce. This step is expected to save the company approximately 1.87 billion dollars and offset costs associated with import tariffs.
Production Optimization
The company plans to increase the efficiency of its plant in South Carolina, which last year utilized only 13% of its capacity. The possibility of launching production of the XC60 model at this site is being considered.
“We are taking steps to create a more efficient organization with a structurally lower cost base” – stated Volvo representatives.
Concurrently, in April, Volvo Group (the parent company) laid off 800 employees at plants in Virginia, Maryland, and Pennsylvania. These decisions are occurring against the backdrop of trade wars, as 90% of Volvo cars for the American market are imported.
The staff reductions are accompanied by an active model range update – new electric vehicles, including the ES90, were recently introduced. The company is trying to find a balance between investing in the future and current financial stability amidst economic uncertainty.