Volvo Cars and Mercedes boost profits despite falling sales
STOCKHOLM
Photo by Alay
Premium carmaker Volvo said global supply chain bottlenecks caused it to sell fewer cars, but its profitability increased as it was able to sell vehicles at higher prices. .
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China’s Volvo Cars said global shortages of semiconductors caused sales and profits to plummet in the final quarter of the year.
Retail sales fell 20% to 168,000 units in the fourth quarter of the year.
But revenues fell to a lower rate – 6% – as “strong demand had a positive effect on prices and the sale of more expensive cars” while interest in electrified cars continued to grow global scale.
Revenue fell to 80 billion crowns ($8.6 billion, 7.5 billion euros) from the same quarter in 2020, while net profit fell 60% to 2.3 billion crowns .
Owned by Geely, the Swedish automaker said the shortage of semiconductors worsened in the second half of 2021.
The picture improved for the year as a whole, with revenue jumping 7% to a record 282 billion crowns.
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Net profit soared to 14.2 billion crowns, almost double the figure for 2020.
Profitability also increased, with its operating margin increasing four percentage points to 7.2%.
“2021 has been a year Volvo Cars can be proud of,” said Managing Director Hakan Samuelsson.
“Looking forward, uncertainty is still high. Although the shortage of components has eased somewhat, we expect the supply chain to remain a restraining factor,” he warned.
Volvo Cars, which plans to sell only fully electric models by 2030, said the share of plug-in vehicle sales – including plug-in hybrids – rose to 34% in the fourth quarter.