June 16, 2020 / 1:31 PM / 2 months ago

AB Volvo to cut white-collar workforce by 4,100 jobs as pandemic weighs

FILE PHOTO: Martin Lundstedt, CEO of Volvo, presents the company's first quarter results at a news conference in Stockholm, Sweden April 25, 2017. TT News Agency/Noella Johansson via REUTERS

STOCKHOLM (Reuters) - Truck- and construction equipment maker AB Volvo (VOLVb.ST) plans to cut its white-collar workforce by around 4,100 positions during the second half of 2020, it said in a statement on Tuesday, citing the effects of the COVID-19 pandemic.

The outbreak of the novel coronavirus has slammed demand for trucks, forcing Volvo and its rivals to cut costs, with

fellow truck maker Scania (8TRA.DE) earlier this month flagging it was planning major job reductions.

“The corona epidemic and the global measures taken to fight it has led to a market situation impacting our industry severely,” Volvo CEO Martin Lundstedt said in a statement.

“The effects are expected to be lower demand going forward and we need to continue to adjust our organization accordingly.”

Volvo said around 15% of the expected reductions were consultants, adding that about 1,250 positions were expected to be cut in Sweden.

The Gothenburg-based company, which employs some 104,000 staff, said late in April that net order intake of its trucks had dropped by 75% in March versus February and been net negative since then.

Reporting by Johannes Hellstrom; Editing by Simon Johnson

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