Job cuts hit carmaker's office-based positions
Volvo Cars announced it is reducing its global workforce by 3,000 positions in a bid to make the company more efficient amid external challenges.
According to Volvo, the reductions will primarily affect 1,200 office-based positions in Sweden and will represent around 15% of its office-based global workforce.
"Volvo Cars has initiated negotiations with relevant labour unions and will issue a notice for these office-based positions to the Swedish labour market authorities today," the company said in a statement on Monday.
The cuts will also affect about 1,000 consultant roles, the majority of which are based in Sweden.
The carmaker noted that the specific number of reductions in other regions will be determined in the coming months, but it aims to finish the structural changes before the year ends.
"The actions announced today have been difficult decisions, but they are important steps as we build a stronger and even more resilient Volvo Cars," said Håkan Samuelsson, Volvo Cars President and CEO, in a statement.
The Swedish vehicle manufacturer said the cuts are part of its SEK 18-billion cost and cash action plan that will make its organisation leaner and more efficient.
It anticipates the one-time restructuring cost to reach SEK 1.5 billion.
Samuelsson said the changes come as the automotive industry is "in the middle of a challenging period."
"To address this, we must improve our cash flow generation and structurally lower our costs. At the same time, we will continue to ensure the development of the talent we need for our ambitious future," he said.
Volvo Cars joins other carmakers that have announced workforce reductions, such as Ford and Nissan, amid economic challenges.
