Volvo cars: gross profit is down, but volume sales are up in the first quarter

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Despite gross profit falling 10% in the first quarter, Volvo Cars group, owned by Chinese Geely, saw its sales increase.

Profits down, but sales up. These are the results published by the Swedish car manufacturer Volvo Cars, owned by the Chinese group Geely, this Wednesday April 24. The net profit has decreased by 10% to 3.6 billion crowns (311 million euros) and operating profit by 8% to 4.7 billion crowns, the group sold lower products and recorded a smaller contribution from joint companies, he explained. Excluding the contribution of joint ventures, operating profit increased by 8%according to his press release.

The sales decreased by 2% to 93.9 billion crowns (8.1 billion euros) due to lower income from subcontract manufacturing and negative exchange rate effects. The manufacturer, deeply committed to the transition to electric vehicles, recorded a 12% increase in unit sales to 182,700 vehicles and it shows that its sales in March reached the highest level in one month. Its sales of electric vehicles represent 21% of its total sales, compared to 18% the previous year.

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Volvo still expects high demand

“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.”, said Jim Rowan, CEO of Volvo Cars quoted in a press release. Volvo Cars also showed that the process of separation of Polestarspecialist in high-end electric vehicles, another group was following suit.

Geely has given the green light for Volvo Cars’ stake in Polestar to be reduced to 18% from 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.