Photo: Nelson Ching/Bloomberg
Swedish automaker Volvo is set to report a big operating loss in China for 2012 due to falling sales and costly investments in the new Chengdu plant.
According to Swedish daily Svenska Dagbladet, quoted by Automotive News Europe, Volvo is about to report a loss between 2 billion to 4 billion Swedish crowns ($308 million to $615 million) in China.
The losses in China were triggered by last year’s 11 percent fall in sales, while heavy investments in the new Chengdu-based facility contributed even more to the deep hole in Volvo’s pocket. Moreover, the automaker spent further to build up a network of Chinese dealers, thus the big loss is not as surprising as you may think.
The Geely-owned company also struggled in Europe in 2012, cutting jobs and costs following the continental crisis that also affected the automotive industry.
Story via AutomotiveNews
The losses in China were triggered by last year’s 11 percent fall in sales, while heavy investments in the new Chengdu-based facility contributed even more to the deep hole in Volvo’s pocket. Moreover, the automaker spent further to build up a network of Chinese dealers, thus the big loss is not as surprising as you may think.
The Geely-owned company also struggled in Europe in 2012, cutting jobs and costs following the continental crisis that also affected the automotive industry.
Story via AutomotiveNews
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