Volvo Cars Shares Plunge Nearly 30% As Q3 Loss Triggers 2,500 Job Cuts

Volvo Cars shares plunged nearly 30 per cent on Friday, hitting a record low after the Swedish automaker reported a worse-than-expected third-quarter loss and announced 2,500 additional job cuts. Weak demand in the US, fierce Chinese competition and tariff pressures have intensified its financial crisis.

The company reported an adjusted operating loss of 3.7 billion Swedish crowns ($373 million) for July-September 2026, reversing a 5.8-billion-crown profit a year earlier. Revenue fell 22.6 per cent to 66.9 billion crowns, while free cash flow turned negative at 8.9 billion crowns, compared with an outflow of 4.3 billion crowns last year. Its reported operating loss reached 5.6 billion crowns.

Volvo will eliminate 2,000 positions in Sweden and 500 globally through consultant contract terminations, natural attrition and exit packages. The reductions follow 3,000 previously announced job cuts. Another 5 billion crowns in savings is targeted by the end of 2027.

The pressure reflects diverging regional markets. Volvo's global deliveries fell 10.7 per cent to 141,609 vehicles. In Greater China, deliveries plunged 40.6 per cent to 20,284, while revenue nearly halved as local manufacturers intensified price competition. US deliveries declined 14 per cent to 30,777 amid tariffs, weaker consumer sentiment and expiring EV incentives.

Chinese automakers, including BYD, have intensified price competition, challenging established international brands. Volvo's gross margin consequently dropped to 14.7 per cent from 20.4 per cent a year earlier.

However, the electric vehicle market presents a more complex picture. Volvo's fully electric sales increased 28.6 per cent globally to 45,060 vehicles, accounting for 32 per cent of sales. In Europe, fully electric deliveries rose 51 per cent to 40,466, highlighting stronger demand despite weakness elsewhere. Its EX60 electric SUV has attracted more than 50,000 European orders, but only around 5,000 units have been built against a 40,000-unit target for this year.

Volvo withdrew its full-year sales and cash-flow guidance earlier this month. Chief Executive Hakan Samuelsson warned that further measures could follow if the turnaround disappoints. With shares down approximately 54 per cent this year, investors face questions over whether cost reductions can restore profitability.