Truck maker Volvo profit grows more than expected despite supply chain issues
2022.07.19 09:02
FILE PHOTO: The Volvo logo is seen in truck for sale in Linden, New Jersey, U.S., May 23, 2022. REUTERS/Andrew Kelly
STOCKHOLM (Reuters) -Swedish truck maker AB Volvo posted on Tuesday a bigger rise than expected in second-quarter core earnings, and said it had successfully mitigated effects of supply chain disruptions and higher material costs.
Adjusted operating profit at the maker of trucks, construction equipment, buses and engines rose to 13.75 billion Swedish crowns ($1.3 billion) from 9.73 billion a year ago, beating the 12.17 billion crowns seen by analysts in a Refinitiv poll.
The Gothenburg-based company said, however, that the situation in the global supply chain for components such as semiconductors was still unstable and unpredictable.
“We will therefore continue to have disruptions and stoppages both in the production of trucks and in other parts of the Group,” Volvo Chief Executive Martin Lundstedt said in a statement.
The company said order bookings of its trucks, sold under brands such as Mack and Renault (EPA:RENA) as well as its own name, fell 8% year-on-year in the quarter.
A global shortage of components, such as semiconductors, and a lack of freight capacity have pressured truck makers after markets began to recover from a pandemic-induced demand slump.
($1 = 10.3932 Swedish crowns)
