Volvo profits up 7% in Q1 2023, focus on continued “transformation”

Alexi Falson

Volvo has released its financials for the first quarter of 2023, with the company looking to accelerate its electric transformation plans with a strong 7 per cent increase in operating profit.

All up, the results were a fairly mixed bag, with Volvo Cars reporting a significant jump in revenue for the first quarter, up from SEK 74.3 billion to 95.7 billion, though its margins have shrunk considerably amid rising costs.

Volvo Car’s operating income decreased from SEK 6.0 billion in the first quarter of 2022 down to 5.1 billion, with its EBIT margins closing from 8.1 per cent last year to 5.3 per cent.

The company describes it as kicking the year off on a “stable note” as it looks to expand its electric vehicle portfolio.

The momentum seems clear, with Volvo Cars more than doubling the number of fully electric deliveries from an 8 per cent share this time last year to a total of 18 per cent of its current lineup.

As the only two fully electric vehicles in the stables, sales of the Volvo XC40 and the C40 have been the primary drivers of its electric vehicle sales increase, with the company stating it plans on introducing a new battery-electric model every year.

In Australia, Volvo says that its lineup will be fully electric by 2026, while the greater goal for the company is to reach that target by 2030.

Volvo says that demand for its EX90 flagship electric SUV has “surpassed the company’s boldest projections” and has forced Volvo to close the order books for now.

On the sustainability front, Volvo Cars says that its combined CO2 emissions have dropped 20 per cent from 2018 levels, which it hopes to drop at a rate of 40 per cent per year by the middle of the decade. Volvo Car’s president and CEO, Jim Rowan, said:

“We have started 2023 on a stable note, continuing to deliver on our ongoing transformation with increased revenues and core profits in the first quarter. With this performance, we’ve laid a strong foundation for the rest of 2023, but we remain ever vigilant amidst the continued turbulence around the world… our focus is on execution.”

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