Volvo Continues to Increase Car Sales Amid Job Reductions | Carscoops
The cuts are expected to assist Volvo in mitigating the expenses associated with U.S. administration tariffs.
The automaker recently revealed plans to reduce its global workforce by 15 percent.
Volvo estimates that these reductions will save approximately $1.87 billion, which will help counterbalance the tariff costs.
Additionally, the company is looking to improve the efficiency of operations at its plant in South Carolina.
Volvo's sales in the U.S. have increased by 6 percent this year, tallying 64,680 units by midyear. Despite this positive trend, the company is exercising caution by announcing a reduction of about 15 percent of its local commercial workforce to manage costs and prepare for possible economic fluctuations.
On the surface, these job cuts may appear ill-timed, as Volvo has introduced several new models, including the all-electric EX90 and ES90. However, it has come to light that many of the employees impacted by these layoffs were recruited during the pandemic, with some of the reductions achieved through attrition.
Job Reductions at U.S. Headquarters
According to an unnamed source within Volvo, around 60 positions have been eliminated, primarily at the company's headquarters in New Jersey. Volvo stated that it is “taking measures to become a leaner, more efficient organization with a structurally lower cost base.” The company added that this would better position them for a profitable future in the Americas and for Volvo Cars as a whole.
Volvo is not only cutting jobs in the U.S.; Auto News reports that the company plans to reduce its global workforce by 15 percent, which equates to roughly 3,000 positions. Most of these cuts will occur in Sweden and are partially attributed to President Donald Trump’s tariffs.
Approximately 90 percent of the vehicles Volvo sells in the U.S. are imported, and to counter these tariff expenses, the company aims to save $1.87 billion.
Other Layoffs
In April, Volvo announced it would be laying off about 800 workers within its U.S. operations, affecting factories located in Dublin, Virginia, Hagerstown, Maryland, and the Mack Trucks plant in Macungie, Pennsylvania.
Simultaneously, Volvo is reportedly seeking to optimize the operations at its Ridgeville, South Carolina plant. Last year, only 20,000 vehicles were manufactured at the facility, which accounted for just 13 percent of its total capacity. To increase production, the company is considering adding XC60 manufacturing to that location.
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Volvo Continues to Increase Car Sales Amid Job Reductions | Carscoops
The reductions are said to assist Volvo in alleviating the expenses associated with U.S. administration tariffs.