Volvo’s Second-Quarter Earnings Plunge
Truck maker Volvo AB posted its biggest profit decline in 18 months after stricter emissions rules caused U.S. truck sales to plunge 54%, Bloomberg reported Wednesday.
Second-quarter net income dropped 14% to about $600 million or 30 cents a share, from about $695 million or 34 cents a year earlier. Gothenburg, Sweden-based Volvo reports its earnings in Swedish kroner.
Volvo’s shares fell following the news by the most in more than eight years, Bloomberg said.
Chief Executive Officer Leif Johansson forecast 2007 U.S. industry-wide heavy-truck sales will fall as much as 30% as customers have slowed purchases since the Jan. 1 start of new U.S. emissions regulations, Bloomberg reported.
Volvo, which owns Volvo Trucks North America and Mack Trucks, said a decline in the dollar reduced earnings by $100 million in the second quarter, and production delays cost another $45 million.
The company’s European truck orders surged 68% to 47,911 vehicles, helping lift orders worldwide, minus the newly acquired Nissan Diesel Motor Co., by 45%, Bloomberg reported.
