Volvo: truck sales fall, equipment remains steady
Volvo group sales impacted by H2 global market decline, but CE steady
Volvo Group reported a fall in sales for its truck business unit in 2012, while sales in its construction equipment unit grew 1%, following poor fourth quarters for both segments.
Volvo recorded total group revenue of $47.9 billion (303,647 MSEK), a drop of $1bn from 2011. Of this, it sold trucks worth $30.3bn (down 3%), and construction equipment worth $10.0 bn (an increase of 0.09% over 2011). Both segments were impacted by a decline in the last three months of the year.
Announcing its fourth quarter and full year results, Volvo Construction Equipment (Volvo CE) reported sales nearly identical to the previous year, despite a "dramatic drop" in global demand in the second half.
The company produced its second-best ever output, selling 78,491 machines during the year, asd well as building on its position as a market leader in the Chinese wheel loader and excavator segment, with a share of 15%.
"Taken as a whole, 2012 was a reasonable year," said Pat Olney, president of Volvo CE. "We sold over 78,000 machines, recorded the company’s second highest ever revenues and our proactive downturn management helped protect cash flow and profitability.
"We recognised the turn in the industry early, and the work undertaken to reduce pipeline inventories was successful. Stock levels have been reduced by around 30% since late spring and are now in balance with current demand."
The prospects for 2013 remain subdued, said Olney, with unit sales in Europe, the most important market for Volvo CE after Asia, predicted to decline by 5-15%.