Volvo Cars reports record six-month performance in H1 2021

• Revenue of MSEK 141,131 (111,759), +26.3%
• Operating income increased to MSEK 13,238 (-989)
• EBIT margin of 9.4% (–0.9%).
• Basic earnings per share of SEK 163.63 (-35.99)
• Retail sales up 41.0%, resulting in approximately 775,000 cars sold for the last 12 months
• Electrified ‘Recharge’ line-up accounted for 25% of total sales

Volvo Cars today reported the best half year results in terms of sales and operating profit in its 94-year history amid increasing demand for its cars across all regions. The half-year financial report, which can be found  here: Volvo Cars first half year 2021 Report, showed the company achieved a revenue of SEK141 billion, up 26 per cent, driven by strong demand an positive mix effects. Operating income was SEK13 billion in the first six months of 2021, representing an operating margin of 9.4 per cent.

Sales volumes rebounded 41 per cent compared to the pandemic-affected period in 2020, but the company also saw strong growth of 12 per cent compared to the first six months of 2019, a more relevant comparison without the pandemic disruption. The 12-month rolling sales volume is approximately 775,000 cars, just shy of the 800,000 target set 10 years ago.

“The company continued to grow strongly despite the industry-wide semiconductor shortage, but more importantly, we demonstrated that we are a leader of the ongoing transformation in the automotive industry,” said Håkan Samuelsson, chief executive of Volvo Cars.

Volvo Cars aims to become the fastest transforming company in the sector and to be fully electric by 2030.The appeal of Volvo’s electric cars was demonstrated in the first half by the demand for its Recharge models. Sales of both its fully electric and plug-in hybrid cars grew significantly, now making up 25 per cent of the global volume. This is the highest electrification share as a proportion of total sales among traditional car makers.As part of the move towards full electrification, we launched our second fully electric model, the Volvo C40 Recharge. At the same time, we firmed up our strategy of online sales to meet changing consumer behaviour. From now on all fully electric models will be available exclusively through volvocars.com, and customers can order at their place of preference; from their home, at a Volvo studio, or together with a retailer. We are now operational with online sales in several markets, with transparent and flexible consumer offerings including care packages of service, wear & tear as well as insurance. Volvo Cars’ subscription offering, Care by Volvo, had a fivefold increase in the first six months to over 10,000 contracts. Securing sustainable batteries is key for Volvo Cars’ transformation. The company is therefore planning to join forces with Northvolt as a strategic partner for joint development and manufacturing of next generation battery cells.

To ensure focus on electrification, Volvo Cars is carving out its internal combustion engine operations into a new unit, Aurobay, in which Geely Holding will be a main shareholder. Through Aurobay, Volvo Cars will realise synergies as well as secure a supply of competitive combustion engines for its hybrid powertrains until the company is fully electric.

“Volvo Cars has a decade-long track record of successful transformation. The car industry is changing more than ever, and we have a strong determination to be the fastest transformer,” said Håkan Samuelsson.

In May, the Board announced that it is evaluating a possible initial public offering (IPO) on Nasdaq Stockholm. The evaluation process continues.

Looking at the remaining half year, Volvo Cars reiterates its full-year outlook. Unless supply of semiconductors improves, the company expects flat sales and revenue for the second half year, compared with the same period last year, despite strong customer demand.

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Volvo Car Group in 2020

For the 2020 financial year, Volvo Car Group recorded an operating profit of 8.5 BSEK (14.3 BSEK in 2019). Revenue over the period amounted to 262.8 BSEK (274.1 BSEK). For the full year of 2020, global sales reached 661,713 cars (705,452), a decline of 6.2 per cent compared to 2019.

About Volvo Car Group

Volvo Cars was founded in 1927. Today, it is one of the most well-known and respected car brands in the world with sales of 661,713 cars in 2020 in about 100 countries. Volvo Cars has been under the ownership of the Zhejiang Geely Holding since 2010.

As of December 2020, Volvo Cars employed approximately 40,000 (41,500) full-time employees. Volvo Cars' head office, product development, marketing and administration functions are mainly located in Gothenburg, Sweden. Volvo Cars' head office for APAC is located in Shanghai and for Americas in Mahwah, NJ. The company’s main car production plants are located in Gothenburg (Sweden), Ghent (Belgium), South Carolina (US), Chengdu and Daqing (China).

Under its company purpose, Volvo Cars aims to provide customers with the Freedom to Move in a personal, sustainable and safe way. This purpose is reflected into a number of business ambitions: for example, by the middle of this decade it aims for half of its global sales to be fully electric cars, half of its sales to be online and half of its software to be in-house. Volvo Cars is also committed to an ongoing reduction of its carbon footprint, with the ambition to be a climate-neutral company by 2040.