vehicle manufacturing capacity in several regions, to reflect
decreasing demand for trucks and other large road vehicles in the
European market.
The company said that negative market development, accentuated
by financial uncertainty and credit restrictions caused by recent
turmoil in financial markets, had prompted the decision.
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It added that its customers “have become more conservative in
replacement of vehicles and some are not being granted loans to
finance new trucks.”
Volvo Bus recently sold its body plant in Turku, Finland, as a
part of this strategy. The company has explained that it will be
more efficient to sell the plant and purchase bodies from the new
owner.
Earlier this year Volvo restructured its Financial Services
division in order to align it more closely to its other business
areas, including Volvo Trucks and Volvo Bus, the two divisions that
are now being downsized.
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