Swedish automaker Volvo Cars has announced plans to eliminate approximately 2,500 jobs as part of an effort to reduce costs. Around 2,000 of the positions will be in Sweden. The company disclosed the planned cuts when releasing its financial results for the third quarter of 2026.

According to Bloomberg, amid deteriorating financial performance, shares in Volvo Car AB fell by more than 30%, reaching a historic low.

From July to September 2026, Volvo Cars generated revenue of 66.9 billion Swedish kronor, down from 86.4 billion kronor in the same period a year earlier. The company recorded an operating loss of 5.6 billion kronor. By comparison, it posted an operating profit of 6.4 billion kronor in the third quarter of 2025.

The company attributed the results to intensifying competition from domestic manufacturers in China’s automotive market and growing pressure on prices. As a result, revenue in China fell by nearly 50% year over year. In the United States, the company continues to face the negative effects of tariffs introduced by the administration of Donald Trump, as well as the withdrawal of incentives for electric vehicles.

To reduce costs, Volvo Cars plans to allow contracts with consultants to expire, leave some positions unfilled when employees depart voluntarily, and offer compensation packages to workers whose jobs are eliminated. Bloomberg reports that the planned reductions will affect approximately 6% of the company’s workforce. In 2025, Volvo Cars also ended employment for around 3,000 workers, equivalent to 15% of its office-based staff.

Volvo Cars also plans to begin production in 2027 of the first two of six models developed specifically for the Chinese market. The project will be carried out in cooperation with the Geely Group, which owns nearly 80% of the automaker’s shares. According to Volvo Cars CEO Håkan Samuelsson, the previous business model of developing cars in Europe and selling them at higher prices in China is no longer as viable as it once was.