About 2,500 more Volvo jobs are going away, roughly 2,000 of them in Sweden, after the carmaker posted a third-quarter loss and watched its stock fall to a record low on Friday. The company’s own earnings release calls the moment a “very tough environment”.
Volvo Cars job cuts: what the company announced
The automaker plans to cut about 2,500 jobs worldwide, and roughly 2,000 of them are in Sweden. Volvo says the reductions will come from ending consultant contracts, natural attrition and targeted exit packages. It also plans another SEK 5 billion in cuts to indirect spending and variable costs.
Those savings are expected to land by the end of next year, according to Reuters. Bloomberg puts the cuts at about 6% of the workforce. Reuters says they come on top of the 3,000 cuts announced in 2025. Volvo is not the only company trimming staff, either. eBay recently made a similar move, as its second round of layoffs at 9% of staff shows.
CEO Håkan Samuelsson was direct about it. “The third quarter of 2026 was very disappointing,” he said, adding that Volvo must “reinforce our turnaround plan with additional decisive actions.”
The numbers behind the Volvo layoffs
Adjusted operating earnings came in at a loss of SEK 3.7 billion, a margin of negative 5.6%. A year earlier Volvo made SEK 5.8 billion. Reported operating income was even worse, a loss of SEK 5.6 billion, according to the release.
Revenue fell to SEK 66.9 billion from SEK 86.4 billion. At the same time, gross margin dropped to 14.7% from 20.4%. Free cash flow was negative SEK 8.9 billion, roughly double the cash burn of a year ago.
Investors reacted quickly. Shares fell as much as 27% to a record low in early Stockholm trading, Bloomberg reported. Other outlets cited drops from about 21% to 31% at different points in the day. The stock was already down 54% for the year before this morning.
China drives the Volvo restructuring, and America is not far behind
China revenue fell almost 50% from a year earlier, CNBC reported, blaming “hypercompetition” from Chinese rivals. Samuelsson told CNBC the shift in China has come “faster than we thought.” Volvo is owned by China’s Geely Holding, which makes the slump there especially painful. It is also the main reason the Volvo Cars job cuts had to grow.
The US market is not helping either. Volvo Car USA sold 23,766 vehicles in the quarter, down 8.7%. Fully electric sales there dropped 41.1% to 1,787 cars, according to Volvo’s sales report. Tariffs and fewer incentives to buy EVs are the causes the company names. A US accounting change to emissions credits also cost Volvo a SEK 1.1 billion hit. Stellantis’ CEO has called the American EV surge a bubble, as his comments on the US EV shift make clear.
Globally, retail sales fell 10.7% to 141,609 cars. Fully electric models made up 32% of the total.
What Volvo cost cuts mean for drivers
Here is what this means if you own a Volvo or were shopping for one. Volvo built its brand on safety and Scandinavian design, and it is now fighting tariffs, softer EV demand and a Chinese industry that has improved quickly. The near-term risk is not the cars. Instead, it is the pace of new models and how long the company can fund them while burning cash, since the Volvo Cars job cuts will not fix that alone.
There is a bright spot. The new EX60 electric SUV has more than 50,000 orders, though its production ramp is slower than planned. Europe is holding up better than the rest of the world, with electric sales up 51% in Europe and the rest of the world.
Watch the Swedish unions, the EX60 ramp and the next earnings report. A turnaround plan is only a plan until the numbers move. The question now is whether Europe and the EX60 can carry enough of the load to protect the jobs that remain.
