Sweden, May 27: Swedish automaker Volvo Cars AB has announced sweeping global job cuts, slashing around 3,000 positions, or nearly 7% of its total workforce, as part of a major cost-cutting initiative to combat slumping earnings and ongoing industry challenges. The cuts include 1,000 consultants based in Sweden and 1,200 employee-held positions from its Swedish operations (Volvo Personvagnar AB).

Media reports said the negotiations with labour unions are already underway, and affected employees will be formally notified through Sweden’s Public Employment Service (Arbetsförmedlingen). The restructuring follows a sharp drop in Q1 2025 profits, with operating income falling to 1.9 billion kronor, down from 4.7 billion kronor a year earlier. Revenue also declined to 82.9 billion kronor, compared to 93.9 billion kronor in Q1 2024, while the EBIT margin halved to 2.3%. Luminar Layoffs: US-Based LiDAR and Self-Driving Tech Developer Cuts More Jobs Amid Ongoing Restructuring, Sudden Departure of CEO Austin Russell.

Volvo To Cut 3,000 Jobs in Cost-Cutting Initiative

Volvo Cars CEO Hakan Samuelsson, who returned to lead the company earlier this year, described the move as a “difficult but necessary decision” to build a “stronger and more resilient Volvo Cars.” The layoffs are part of an 18 billion kronor (USD 1.87 billion) cost-reduction programme launched in April. The programme's primary focus is on white-collar roles, including R&D, communications, and HR, which make up roughly 15% of the company’s office staff.

Volvo cited global market pressures, waning consumer confidence, and the threat of rising tariffs, particularly from the US, as key factors behind its strategy shift. The company also confirmed it will no longer issue financial forecasts for 2025 and 2026, citing increased volatility in global trade. The restructuring, expected to be completed by autumn 2025, will incur a one-time charge of 1.5 billion kronor, which will hit the company’s Q2 financials and have residual effects into 2026. TikTok Layoffs Expected Soon: TikTok Shop US Head Mu Qing Asks E-Commerce Staff To Work From Home Amid Operational Restructuring and Future Ban, Says Report.

Though owned by China’s Geely Holding, Volvo insists the cuts are internally driven and not a result of external pressure from its parent company. Recent moves to shift EV production of models like the EX30 and EX90 from China to Belgium underscore Volvo’s strategy to navigate evolving global trade dynamics.

(The above story first appeared on LatestLY on May 27, 2025 07:48 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).