Geely’s Volvo Automobiles warns on gross sales as provide woes dent output

STOCKHOLM (Reuters) – Sweden-based automaker Volvo Automotive Group warned on Friday that gross sales volumes within the second half of 2021 might fall year-on-year after it was compelled to chop manufacturing as a result of materials shortages.

© Reuters/Yves Herman
FILE PHOTO: An worker at a Volvo automobile supplier, carrying a protecting masks is seen in a showroom, in Brussels, Belgium

The carmaker, owned by China’s Geely Holding, mentioned gross sales fell 10.6% from a yr in the past in August, regardless of sturdy underlying demand, and cautioned the potential decline in volumes within the second half might impression income and revenue.

“However Volvo Automobiles’ outlook for the complete yr 2021 nonetheless stays,” it mentioned in a press release, referring to a forecast of gross sales quantity and income progress with improved profitability to pre-pandemic ranges.

Volvo Automobiles mentioned provider shut-downs since mid-July – as a result of native efforts to restrict the unfold of the extremely contagious Delta variant in South-East Asia – had worsened an already strained provide state of affairs, forcing it to halt manufacturing.

A worldwide chip scarcity over the previous yr had already induced a serious delay in manufacturing exercise and compelled a number of automakers to cut back output.

World gross sales on the agency, which is contemplating itemizing on the Nasdaq Stockholm inventory trade this yr, fell to 45,786 vehicles in August, with gross sales in Europe dropping 25% whereas they rose 3% in america.

(Reporting by Helena Soderpalm; enhancing by Niklas Pollard)