STOCKHOLM (Reuters) – Sweden-based Volvo Cars reported a fall in fourth-quarter operating profit on Thursday and predicted a turbulent 2025 with challenging market conditions.
The company, which is majority-owned by China’s Geely, said it doesn’t expect the market to grow at the same rate as in previous years, and that increased competition was likely to mean price cuts across the sector.
“As a result, it will be challenging to reach the volumes and profitability level we achieved in 2024,” CEO Jim Rowan said in a statement.
The company however repeated a forecast for a core operating profit margin of 7–8%.
Operating profit in the fourth quarter was 3.9 billion Swedish crowns ($357 million) against a year-earlier 5.4 billion. The profit includes a 1.7 billion crown writedown related to its battery joint venture Novo Energy.
Excluding joint ventures and associates, operating profit was 6.3 billion crowns, down from 6.7 billion.
Demand for electric vehicles has weakened in recent years partly due to a lack of affordable models and the slow roll-out of charging points. Car makers are also bracing for effects of European and American tariffs on electric cars made in China.
($1 = 10.9245 Swedish crowns)
(Reporting by Marie Mannes, editing by Anna Ringstrom)
