Volvo reports steady growth despite Q2 sales dip

Volvo Cars announced that its sales slightly dropped in the second quarter of 2022 due to the challenges caused by uncertainties in global trade, increasing raw material prices, and supply chain constraints arising out of recent pandemic lockdowns in China.

The brand’s retail sales amounted to 143,006 units, which bring the quarter’s sales down by 27 percent compared to the same period last year. This resulted in a total revenue of SEK71.3 billion (around US$6.9 billion), bringing the company’s second-quarter earnings down by two percent.

Despite it all, the Swedish automotive brand reports that it still continues to experience steady earnings for the second quarter of this year thanks to strong pricing and product mix.

“When looking back at Volvo Cars’ performance during a very turbulent second quarter, we are satisfied that we have delivered steady earnings. The demand for our products continues to be robust, and we remain focused and clear that the short-term business challenges will not weaken our resolve to meet our mid- to long-term strategic ambitions. If anything, it will only speed up our pace of change,” said Volvo Cars President and Chief Executive Jim Rowan.

Volvo Cars is also seeing a marked improvement in the stabilization of its supply chain, with production making a strong comeback in June. Should this normalization continue, the Gothenburg-based company expects production to progressively increase in the coming months.

That said, Volvo Cars expects its wholesale volumes for 2022 to be better than in 2021.

For this year’s second quarter Volvo Cars’ Recharge models remained popular among customers with Recharge models making up 31 percent of the brand’s total sales, an increase from 24 percent of total sales in the same period last year.

In addition, the number of active subscriptions at the end of the second quarter increased by 122 percent compared with the same period last year. Volvo Cars reports that the growth was stimulated by customer demand in combination with a broadened offer as online fleet sales for small and medium enterprises were introduced both in the UK and in Sweden.

Furthermore, Volvo’s online sales made up 9.5 percent of total sales in established markets, compared with 4.6 percent in the same period last year.

“Like many others, our short-term business challenges remain. However, we are confident and focused on delivering on our strategic ambitions and purpose,” Rowan said.

Photos from Volvo

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