Volvo predicts chip shortages to continue as profits go down
Swedish car maker Volvo has predicted the ongoing semiconductor chip shortages will extend into the new year, impacting the supply chain.
Since its listing in the Stockholm stock exchange at the end of October, the group has reported a slump in profit and revenue, going down from 4.6bn Swedish crowns (£380.8m) to 3.3bn (£273.2m) year on year. Revenues also suffered a significant decrease, decreasing by 7 per cent to 60.8bn Swedish crowns (£5bn).
Today, the company shares bottomed at 195.94 Swedish crowns – the lowest registered since its market debut.
The group also added that supply chain issues will remain a major issues in the fourth quarter, with production expected to remain lower than demand.
“Production was approximately 50,000 cars lower in the quarter compared to the same period in 2020, while sales in the period fell by approximately 30,000 cars as the drop in production volumes was compensated by lowered inventory,” said Volvo’s chief executive Hakan Samuelsson.
“The supply situation has improved going into the fourth quarter, but we expect the industry-wide shortage of semi-conductors to remain a restraining factor.”
The car giant also announced to have increased the number of shares by 479.5 million, while reducing the number of votes by 16 billion.