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Truck maker sheds more workers as demand falls
Source: Agencies |
April 23, 2009, Thursday
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Print Edition
Print Edition
TRUCK maker Volvo is to cut a further 1,543 jobs at the group as it seeks to adjust to plummeting demand across all its main markets.
Volvo said yesterday that employees at its Volvo Trucks, Construction Equipment, Penta and Powertrain units would be affected.
"As a result of the sharp decline on world markets for heavy vehicles, the Volvo Group is being forced to implement new personnel reductions within its Swedish operations," the company said.
The job cuts announced yesterday come on top of the thousands of staff the company is already in the process of laying off in order to come to grips with the sharpest decline in heavy-duty truck markets in living memory.
A spokesman said the job cuts would reduce costs, but declined to give any specific figure for the savings.
"It is no huge surprise that they make further cuts but it underlines how bad things really are," said one analyst.
"The previous wave of cuts came in October and this clearly shows that things have not improved since then."
Volvo, which also makes trucks under the Renault, Mack, Nissan Diesel and Eicher brands, said it was talking to the unions about a shorter working week.
Declining demand and overcapacity led the company to report a pretax loss in last year's final quarter and many analysts see the company staying in the red this year.
"The truth is that if the company is to survive, it must push down costs. But if they do this early enough, and powerfully, they can definitely survive on their current balance sheet," a second analyst said.
Volvo reports its first-quarter results tomorrow.
Volvo said yesterday that employees at its Volvo Trucks, Construction Equipment, Penta and Powertrain units would be affected.
"As a result of the sharp decline on world markets for heavy vehicles, the Volvo Group is being forced to implement new personnel reductions within its Swedish operations," the company said.
The job cuts announced yesterday come on top of the thousands of staff the company is already in the process of laying off in order to come to grips with the sharpest decline in heavy-duty truck markets in living memory.
A spokesman said the job cuts would reduce costs, but declined to give any specific figure for the savings.
"It is no huge surprise that they make further cuts but it underlines how bad things really are," said one analyst.
"The previous wave of cuts came in October and this clearly shows that things have not improved since then."
Volvo, which also makes trucks under the Renault, Mack, Nissan Diesel and Eicher brands, said it was talking to the unions about a shorter working week.
Declining demand and overcapacity led the company to report a pretax loss in last year's final quarter and many analysts see the company staying in the red this year.
"The truth is that if the company is to survive, it must push down costs. But if they do this early enough, and powerfully, they can definitely survive on their current balance sheet," a second analyst said.
Volvo reports its first-quarter results tomorrow.
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