Volvo Cars reports record revenue and sales in H1

Volvo Cars reported on Thursday a record revenue for the first six months of 2019 of 130.1 billion SEK, up from 122.9 billion SEK year-on-year and supported by the best first half-year sales performance in the company's history.

According to the company's press release on Thursday, for the first six months, Volvo Cars sold a record 340,286 units, a year-on-year increase of 7.3 percent. During the period, Volvo Cars grew consistently faster than the overall market.

The company has gained market share across the U.S., China and Europe, with the UK and Germany recording growth of 30 percent and 32 percent respectively. The overall passenger car market in the U.S. declined by 2.0 percent in first half, while China and Europe fell by 9.3 percent and 3.1 percent respectively during the same period.

Hakan Samuelsson, president and CEO, emphasised that the company has prioritised growth and market share during the period, capitalising on the building momentum for the Volvo brand generated by an all-new line-up of award-winning models.

"At a time when most markets in the world see stagnating car sales, we have had strong growth in the first half," he said. "We continue to take market share in all regions where we operate, but increased pricing pressure and tariffs have decreased our operating profit. The cost measures we took earlier this year will come into effect in the second half of the year."

Operating profit for the first half of 2019 was 5.5 billion SEK, compared with a 7.8 billion SEK operating profit for the same period last year. For the second quarter of the year, operating profit fell to 2.6 billion SEK, while revenue rose to 67.2 billion SEK.

According to the company, Volvo Cars has initiated additional cost measures within the company on top of already planned measures, which combined, aim to lower fixed costs by 2 billion SEK. These actions will come into effect in the second half of the year and running into the first half of 2020.

For the remainder of the year, Volvo Cars expects continued growth in sales and revenue, boosted by continued strong demand for the fully renewed product portfolio as well as increased production capacity.

Market conditions are expected to put continued pressure on margins, but the combination of volume growth and cost measures is expected to result in a strengthened profit in the second half of the year compared with the same period last year.

Volvo Cars, acquired by Chinese automaker Geely in 2010, employs 43,000 people globally.