Volvo Cars reported higher earnings for the second quarter, boosted by increased new-car sales in China, Europe and North America. Hit the jump to read the rest of the story.
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The former Ford Motors Co. brand, now owned by China’s Geely Holding Group, said operating EBIT (earnings before interest and taxes) was 600 million kronor ($95 million), an improvement of 170 million kronor compared to the same period last year.
Revenue was 33 billion kronor, up 3.5 billion kronor from the year before period.
“We are gradually returning to sustainable profitability although we have more work to do before we reach our objectives,” CEO Stefan Jacoby said in a statement on Wednesday.
Volvo said higher sales volumes and an improved mix of vehicles were mainly responsible for the quarterly profit increase, although this was offset by increased investment costs to support expansion plans.
In June, Volvo said it will boost capacity and add 600 blue collar workers.
Improved sales were mainly driven by strong demand for the new S60 and V60, along with the XC60.
Volvo said second-quarter retail sales rose 26.6 percent to 123,919 cars. China had the largest increase with sales up 62 per cent. In North America sales grew 43 per cent and in Europe, sales were up 15.5 percent. Market share improved in all regions, Volvo said.
In its outlook, Volvo said “the current unstable economic climate is likely to result in additional volatility” that could affect exchange rates, raw material prices and consumer demand.
The carmaker said improved sales were mainly driven by strong demand for the all new S60 and V60 models together with the Volvo XC60 crossover.
In the first six months, Volvo’s unit sales rose 20.3 percent to 230,746. Operating profit was 1.2 billion kronor.
