With sales falling by more than 40 percent, Volvo saw a
significant drop in activity during Q1 2009, which was reflected in
its customer finance division.
The Swedish truck maker reported a larger-than expected
operating loss of SEK 4.53 billion (€ 427 million).
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
Its customer finance branch, Volvo Financial Services (VFS), had
an operating loss of SEK 396 million, compared to a profit of SEK
381 million for the same period last year.
VFS said that the worsened economic situation led to a
deterioration in the portfolio performance when it came to
delinquencies, repossessions and used units in inventory,
particularly in Eastern Europe.
“This is clearly evident in the overall financial results for
the quarter as provisions for credit losses were increased
significantly to cover the level of impairments in the credit
portfolio that has developed in this region”, the company said.
Total new financing volume reached SEK 7.5 billion, which was 33
percent down compared to Q1 2008.
In the markets where it offers finance, its penetration rate
increased from 22 percent to 28 percent.
Antonio Fabrizio
