Sweden Volvo On Thursday, a 12% increase in full operating revenue and registration revenue reported, but warned of severe market challenges ahead of intensifying electrical vehicle competition and global tariffs.
Automaker, who is owned by the majority by China’s Geely Holding, said operating revenues entered 22.3 billion Swedish Chronicle ($ 2.04 billion) in 2024 in the middle of an 8% increase in sales.
However, Profit slipped 28% in the last three months of the year, which the company said was affected by a one -sided 1.7 billion chronicle injury to its joint enterprise with the Swedish Northvolt battery developer Novo Energy. Sales from year to year for the fourth quarter noun 1% higher, but poured 6% in China and 2% in the JBA
The company reiterated the 2026 guidance to give a substantial profit before interest and taxes (EBIT) the difference of 7-8%, but said 2025 would be a “challenging year and transition” towards Volvo Cars long-term growth ambitions after Waiting for slow market growth and “increased descents” throughout the industry.
This will make it difficult to match the volumes and benefit of the company 2024, she added.
Shares slide 6% in the European market open on Thursday.
A fully electric Volvo ex30 car appears during everything London 2024 in Excel in London, March 28, 2024.
John Keeble | Getty Images News | Getty Images
Many motorists are struggling with increasing competition and high costs in electric vehicle space, including key players such as Tesla.
Volvo cars in September removed its plan to sell only EV by 2030, citing “different adoption speeds” by customers. In its 2024 results, EV battery sales increased to 23% by 16% over the previous year.
“I think it’s a reasonable performance given the amount of turbulence we saw in [20]24, “Volvo Cars Director General Jim Rowan told the” Squawk Box Europe “of CNBC about the results in a Thursday’s interview.
“Inside [20]25 I think we will see the turbulence grow. And the way I Corn it is, I think we will see the turbulence in terms of trade tariffs, perhaps some geopolitics, and we will see some policy changes. I also think we will see the transition to EV slows down a little, which is okay for Volvo cars because we have soft hybrid technology as well as connecting hybrid technology. “
Global automobile shares were blocked on Monday after US President Donald Trump announced 25% tariffs in Canada and Mexico, the main basics of production and supply to the Imports of Vehicle to the US Many have regained the ground after the implementation of tasks was stopped for 30 days.
Rowan said Volvo Cars was now appreciating if he had to move her production lines to protect himself.
The company has already had to navigate the increased tariffs for EV coming from China to the European Union and were shifting production from China to Belgium as a result, he said.
“Last year, we saw the batteries grow from 7.5% to 25% when you import them to the US, if they are of abroad origin from a country without a free trade agreement,” he said he cnbc.
“So we will see more of this, and we have to wait to see how it plays, of course, but we are preparing ourselves to see if we have to start looking at the displacement of production or even shifting the supplier in it different parts of the world.
“Then we will see this great shift in technology beyond electrification, so that software, silicone, connection and data will become much deeper,” Rowan added.
The high cost of developing new automotive technology, such as partially self-driving vehicles, is expected to promote industry consolidation, recently leading to unstable Union talks in Japan Honda AND Nissan.
On competition from Chinese players such as ByRowan told CNBC: “The descent is mainly concentrated on the entrance, the mass market.”
He added that his company does not really “play in that sector” and mainly sells soft electric hybrids and plug-in in China, accessing a premium offer.
“That said, I think we will start to see perhaps in 2025 some extra discounts that may begin to tread in the premium market, and some of the western brands lose market share in China. Then, of course, they are they are Going to return to their internal markets and other global markets and try to get the market share there to keep income flows at the same level, “Rowan said.
“So I think that hyper-context and price and discipline starts in China. But I think it will travel to Europe and North America as well, by 2025.”