Volvo Cars announced Monday it will cut around 3,000 jobs as part of a global plan to reduce costs by nearly $2 billion.
The decision comes during a time of economic pressure and trade tension in the global auto industry.
The job cuts will mainly affect office workers in Sweden, with about 1,200 employees and 1,000 consultants losing their positions, Independent said.
The rest of the reductions will happen in other countries where Volvo operates. These changes will impact about 15% of the company's office-based workforce.
"These decisions are tough, but necessary," said Håkan Samuelsson, Volvo Cars President and CEO. "The car industry is going through a hard time, and we need to improve how we manage money and lower costs."
Volvo, which is owned by China's Geely Holding, has 42,600 full-time employees worldwide. The company shared that the job cuts are part of a broader plan that also includes lowering investments and slowing down other spending.
🚨 LAYOFF ALERT – 🌎
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Volvo Cars is laying off 3,000 employees globally, citing cost-cutting efforts amid trade tensions and economic uncertainty. The move comes as the industry faces pressure from 25% U.S. tariffs on cars and steel, rising raw material costs, and a shrinking… pic.twitter.com/pdmJXEKjuM
Volvo Adjusts Strategy Amid Rising Tariff Tensions
According to CNBC, the cost-saving plan was first announced in April, and at the same time, Volvo withdrew its financial goals for 2025 and 2026.
One major reason was growing uncertainty around trade tariffs, especially between the US and the European Union.
Recently, US President Donald Trump threatened to raise tariffs on cars from Europe to 50%, though he later said those tariffs would be delayed until July 9 after a discussion with the EU Commission President Ursula von der Leyen.
For now, the EU is already facing 25% tariffs on cars, steel, and aluminum exported to the US.
Volvo says it must adjust its plans to handle these outside challenges. Even as the company continues working toward its goal of producing only electric vehicles (EVs) in the future, it recently said it needs to be more "flexible and practical" due to changing market conditions and slower EV demand.
The company builds vehicles in Sweden, Belgium, South Carolina, and China, and has its main offices in Gothenburg, Sweden. The impact of these changes will be felt across several of those locations.
Volvo stressed that while it is reducing costs now, it still plans to invest in new technology and talent to support its long-term future.
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