Volvo: more turnover, less profit

Volvo sold 615,100 cars worldwide last year, about 12 percent less than a year earlier. Still, the brand is not dissatisfied. Despite the fact that it sold fewer new passenger cars in 2022 than a year earlier, revenue in fiscal year 2022 compared to 2021 increased by 17 percent. Turnover amounted to approximately 29 billion euros.

Increased turnover does not mean that profit has also increased. That is not the case. Volvo Cars’ profit, profit before interest and taxes, fell by 15.7 percent compared to 2021. According to Volvo, this is partly due to problems in the supply chain and the high costs of transport and raw materials. Volvo wants to increase profit margins this year. It has a ‘comprehensive plan for cost and efficiency optimization’ for that. What this means in practice remains to be seen later. Volvo also expects 2023 to be a challenging year, but hopes that supply shortages from China will be a thing of the past and semiconductor supply will continue to improve. Volvo also expects the price of lithium needed for batteries to fall around the end of the year.

Volvo is pulling the curtain this year on the EX30, a new compact electric SUV that is one step below the XC40. That car may boost sales figures. At the bottom of the line, Volvo is aiming for double-digit growth for 2023.