Volvo Profits Stall as Sales Zoom

February 07, 2019 at 1:47 AM

Volvo Car Corp. saw revenue climb 21% to 253 billion kronor ($27.5 billion) last year, as unit sales rose 12% to a record 642,300 vehicles.

Earnings before interest and taxes reached a record 14.2 billion kronor ($1.5 billion) but grew only 1%. Net income declined 4% to 9.8 billion kronor ($1.1 billion).

The company’s margin shrank to 5.6% from 6.7% in 2017. CEO Hakan Samuelsson acknowledges that the decline “does not live up to our longer-term ambitions.” But he says the company will strive for greater market share this year anyway, even though doing so will put further pressure on the margins.

In the fourth quarter, Volvo reports gains in unit sales (+7% to 169,700 vehicles), revenue (+20% to 73 billion kronor), EBIT (+25% to 4.5 billion kronor) and net income (+4% to 3.1 billion kronor).