net profit and sales decline in the first quarter but rates are increasing

Swedish carmaker Volvo Cars, owned by Chinese conglomerate Geely, recorded a drop in its net profit and sales in the first quarter but its sales rose, it announced on Wednesday. Net profit fell 10% to 3.6 billion crowns (311 million euros) and operating profit fell 8% to 4.7 billion crowns, the group sold lower-quality products and recorded a smaller contribution from joint ventures, he said. Excluding the contribution of joint ventures, operating profit increased by 8%, according to its press release.

Sales fell 2% to 93.9 billion crowns (8.1 billion euros) due to lower subcontract manufacturing revenues and adverse currency effects. The manufacturer, strongly committed to the transition to electric vehicles, recorded a 12% increase in its unit sales to 182,700 vehicles and indicated that its sales in March reached the highest level in a month.

Its sales of electric vehicles represent 21% of its total sales, compared to 18% the previous year. CONTAINS”We expect demand for our vehicles to remain strong in the coming quarters, based on our forecast for sales volume growth of at least 15% for the full year e.“, announced Jim Rowan, CEO of Volvo Cars quoted in a press release. Volvo Cars also indicated that the process of separating Polestar, a specialist in high-end electric vehicles, from the rest of the group is ongoing.

Geely therefore gave the green light for Volvo Cars’ stake in Polestar to be reduced to 18% compared to 48% previously, according to a press release. The Chinese group will take control of Polestar and finance it, allowing Volvo Cars to focus on their own operations.