Volvo reports ‘steady’ Q1 performance as Chinese market declines

VOLVO Construction Equipment has reported a ‘modest’ increase in net sales for Q1, 2022 in all areas outside of Asia. However, the manufacturer said overall growth momentum was impacted by the market decline in China, triggered in part by the ongoing Covid-19 restrictions there.

The situation in China led to a drop of 9% in overall global sales for the first quarter of the year. Volvo said the performance in all other regions has helped soften the impact by demonstrating a ‘steady increase’ in sales, with South America reporting the highest increase of 62%, North America rising 11%, Africa and Oceania 5%, and Europe 2%. Service sales have also increased by 17%.

Melker Jernberg, president of Volvo CE, said, “There can be no doubt that the industry and the wider world itself is in the midst of extremely challenging times, but I am proud that we as an organisation are tackling these issues head on – supplying our customers with the products and services they need today, while focusing on the tragic humanitarian crises going on around the globe and taking action on urgent climate change.

“During this difficult period, we are keeping up the speed of transformation to more sustainable construction and infrastructure solutions, helping to decarbonise value chains, all the while safeguarding our communities around the world.”

During Q1 2022, Volvo CE saw net sales decrease to SEK 22,613 M from SEK 24,742 M in Q1, 2021. Adjusted operating income amounted to SEK 2,810 M (SEK 3,822 M in Q1, 2021), corresponding to an adjusted operating margin of 12.4%, down from 15.4%.