The announcement follows a difficult third quarter in which Volvo’s sales declined across key markets, particularly China. Despite its ownership by Chinese automotive group Geely, the company has struggled to compete with domestic manufacturers offering lower-priced vehicles and technology developed specifically for local buyers.
Volvo Reports Steep Losses As Competition Intensifies in China
According to Euronews, Volvo Cars reported third-quarter revenue of 66.9 billion Swedish kronor (€6 billion), a decline of nearly 23% compared with the same period in 2025. The company recorded a net loss of 5.7 billion kronor (€513 million), reversing a net profit of 4.5 billion kronor (€405 million) a year earlier.
Global retail sales fell by 11% to 141,300 vehicles between July and September. The company attributed the decline in revenue partly to lower wholesale volumes, an unfavourable sales mix and pricing pressures. China presented a particularly difficult challenge. Deliveries in the country dropped by more than 40% during the quarter, while revenue from the market fell by almost half year on year.
According to Bloomberg, chief executive HÃ¥kan Samuelsson said the traditional business model used by Western manufacturers in China was no longer viable. “Nobody will be successful with the old recipe where you had global cars developed in Europe and sold them at a premium price,” Samuelsson told analysts. “Those times are gone.”
Chinese manufacturers have attracted customers with more affordable electric vehicles, advanced digital features and models designed around local preferences. More than 100 domestic brands are competing for buyers, placing pressure on established European manufacturers.
Volvo’s difficulties have also affected its market valuation. Its shares fell by approximately 30% following the results, reaching a record low. The company was valued at 29.8 billion kronor ($2.68 billion), approximately 80% below its valuation when it listed in 2021.
Job Reductions Form Part of Volvo’s Wider Restructuring
Volvo intends to reduce costs by an additional 5 billion kronor (€450 million), with approximately 2,000 positions affected in Sweden and another 500 elsewhere.
The reductions will involve ending consultancy contracts, natural staff departures and targeted exit packages. The company expects the measures to deliver their full financial benefits by the end of 2027.
According to GB News, Volvo is also examining ways to improve manufacturing efficiency, including potential cooperation with Geely to produce Geely-branded vehicles at its facilities in Chengdu and Ghent. The latest restructuring follows an 18-billion-kronor savings programme announced in 2025, which included approximately 3,000 job reductions worldwide.
US trade policy has added to the manufacturer’s difficulties. Tariffs introduced under President Donald Trump have increased pressure on vehicle exports, while the removal of incentives for electric and plug-in hybrid vehicles has affected profitability in the American market.
Europe has offered a more stable picture. Electric vehicles accounted for 45% of Volvo’s European sales during the quarter, while orders for its electric models increased. Volvo plans to introduce seven new vehicles for Western markets and six models developed specifically for China by the end of the decade. Samuelsson is expected to hand over leadership to former Å koda chief executive Klaus Zellmer no later than 1 October 2027.
