Volvo to slash 2,500 jobs amid intense pressure from Chinese brands and Trump’s auto tariffs

Between July and September, revenues fell by 23 per cent to SEK 66.9 billion (£5billion), as a result of lower wholesale volumes and adverse sales mix and pricing.

In response to the disappointing Q3 results, Volvo will oversee a “reinforced turnaround”, which will include the structural reduction of 2,500 jobs.

Around 2,000 of these will be based in Sweden as Volvo adapts its blue-collar workforce to current volumes by leveraging existing flexibility.

The brand is looking to save SEK 5 billion (£376million) through lowering corporate overheads, ending consultant contracts and offering targeted exit packages to employees.

The Swedish manufacturer has already explored working with Chinese brand Geely to produce Geely-badged vehicles at Volvo plants in Chengdu and Ghent.

It will also develop a more efficient production structure by concentrating on its five dedicated Volvo plants around the world.

Håkan Samuelsson, President and CEO of Volvo, explained that the job cuts and downturn in revenue were due to several factors.

He cited a severe decline in interest for legacy premium brands in China due to strong competition from Chinese-based manufacturers.

Mr Samuelsson said this had “basically eliminated profitability for legacy premium brands”, prompting its revenues in China to fall by almost 50 per cent year-on-year.

Volvo was also hammered by intense automotive tariffs introduced by President Donald Trump on vehicle exports to the United States.

The removal of electric vehicle incentives has also caused issues for the profitability of Volvo in the United States, he noted.

The sole bright spot, Mr Samuelsson said, was the European market, which has stabilised and proved successful for the brand.

Volvo maintains an impressive electric vehicle sales share of 45 per cent in Europe in Q3, with growth in Volvo’s EV orders.

Volvo’s President said: “We continue to operate in a very tough environment with strong external challenges: de-globalisation, hypercompetition and climate change.

“We are convinced that we have the right long-term strategy addressing these challenges.

“However, in the short term, with severely challenged volumes, a reinforced turnaround plan with additional decisive actions, lowering our break-even point and improving cash flows to make us more resilient is needed.”

Volvo has seen a modest 4.83 per cent growth in year-on-year sales in the UK, having registered 54,343 new cars so far in 2026.

It has captured 3.12 per cent of the total market, with the Volvo EX40 being the 10th best-selling car of the year, and the Volvo EX30 being the seventh best-selling electric model in September.