Volvo Cars shares fall up to 27% after 2,500 job cuts and China warning

Results and share price

Volvo Cars shares fell by as much as 27% in early trading in Stockholm on 23 October 2026, after the company reported a third-quarter loss that was larger than analysts had expected. Later in the session the decline was 26.6%, while other early reports put the drop at 30%. Third-quarter revenue reached 66.9 billion Swedish kronor, down 23% from a year earlier, and the company posted a net loss of 5.7 billion kronor. The operating loss was 3.7 billion kronor, an operating margin of -5.6%. Volvo had already issued a profit warning earlier in October and withdrawn its annual forecast, and it has now lost about two-thirds of its market value over 2026.

Timeline

The reorganisation follows about 3,000 job cuts that the company announced in 2025, mostly among office staff. In July 2026 Volvo reached an agreement in principle with the federal and Flemish governments on support measures worth up to 119 million euros for its Ghent site. The profit warning came earlier in October, and the 23 October results triggered the latest round of cuts and the share price fall.

China and the United States

Sales in China fell by almost half in the latest quarter, the company said, as new Chinese electric car brands competed hard and prices came under pressure. In the United States, import tariffs and the end of purchase incentives for electric cars squeezed margins. Europe was the bright spot, with Volvo holding a 45% share of premium battery-electric car sales there in the third quarter, according to a company note. Chief executive Hakan Samuelsson told analysts that the old model of building global cars in Europe and selling them at a premium in China no longer works, and he admitted that Volvo had underestimated how quickly the Chinese market was changing.

Job cuts and cost savings

Volvo plans to cut about 2,500 jobs worldwide, roughly 6% of its workforce, of which 2,000 are in Sweden. The location of the remaining 500 positions has not been disclosed. The reductions will come through ending consultancy contracts, natural staff turnover and targeted severance packages. Many of the Swedish cuts are expected in the Gothenburg area, where the company has its historic base and production sites. Volvo also plans to cut a further 5 billion Swedish kronor, about 450 million euros, in indirect spending and variable costs, with full financial effects expected by the end of 2027. By then indirect spending is expected to be almost 25% lower than in the 2024 fiscal year. Chief financial officer Fredrik Hansson said the reductions would be made through voluntary departures and a very restrictive hiring policy.

Impact on Ghent and Brussels

The impact on Volvo's Belgian operations is not yet known. The Ghent plant employs 6,300 workers, and about 100 people work in offices in Brussels. Job losses there cannot be ruled out, but how the cuts will be split between sites has not been settled. The Ghent plant is the last large car factory in Belgium and is preparing a collaboration with Geely that could bring cars from other brands to the site in future.

Wider industry pressure

Volkswagen and BMW are also reviewing their China operations, strengthening partnerships with Chinese companies and local development teams to respond to domestic competitors and price pressure. Samuelsson's remarks suggest those steps may not be enough to win back lost market positions. Volvo has been owned by the Chinese group Geely since 2010, and it plans to use Geely's technology and platforms to adapt its offer to local preferences in Asia. Samuelsson said Volvo can develop cars with Geely using Chinese software, which he described as a significant advantage.