Volvo Cars announced Monday it will eliminate approximately 3,000 jobs worldwide as part of a sweeping cost-cutting plan, citing rising raw material costs, trade tensions, and weakening auto markets in Europe. The cuts represent a significant restructuring effort for the Swedish automaker, which is owned by China's Geely Holding Group.
"The actions announced today have been difficult decisions, but they are important steps as we build a stronger and even more resilient Volvo Cars," said Håkan Samuelsson, Volvo Cars president and CEO. "The automotive industry is in the middle of a challenging period. To address this, we must improve our cash flow generation and structurally lower our costs."
The job reductions will primarily affect office-based roles, with around 1,200 staff being laid off in Sweden and another 1,000 consultant positions-also mostly based in Sweden-set for elimination. The remainder will come from Volvo's global operations, which span facilities in Belgium, the U.S., and China. Volvo currently employs about 42,600 full-time workers.
The announcement follows the company's April 29 rollout of an 18 billion Swedish kronor ($1.89 billion) cost and cash action plan. At that time, Volvo also withdrew its financial guidance for 2025 and 2026, citing "tariff pressure" and broader industry uncertainties. It noted that its restructuring would include both workforce reductions and a scaling back of capital expenditures across its global network.
The move comes as the global automotive sector contends with escalating tariff risks. President Donald Trump recently threatened to impose 50% tariffs on European Union imports starting in June, though he agreed to delay implementation to July 9 after a call with EU Commission President Ursula von der Leyen. Currently, the U.S. maintains 25% tariffs on European autos, steel, and aluminum.
Volvo stated that while the restructuring is intended to stabilize operations in the near term, it remains committed to its long-term vision of becoming a fully electric carmaker. However, in September, the company acknowledged a softening in EV demand and stepped back from earlier targets, saying it needed to be "pragmatic and flexible" amid changing global conditions.
