VTNA Plans More Production Cuts in Early August
Volvo Trucks North America announced that it will cut production further in August as it adjusts to a period of reduced demand for its longhaul trucks.
“It’s by now very clear that the industry is managing through a period of excess inventory and reduced demand. And we’re seeing that softening particularly in the longhaul segment, which is core for Volvo Trucks,” VTNA spokesman John Mies told Transport Topics on June 1.
Gothenburg, Sweden-based Volvo Group, VTNA’s parent company, said in its first-quarter earnings report April 22 that it was reducing its North American Class 8 market forecast to 250,000 units from 260,000.
VTNA last week advised employees at its New River Valley plant in Dublin, Virginia — which builds every truck it sells in North America — that the truck manufacturer will reduce production in the early August timeframe, as it takes another step to adapt to market conditions, Mies said.
“This unfortunately means that we will have to lay off employees, but it’s too soon to say how many people or exactly when,” Mies said.
The latest talk of more cuts follows an agreement in April between VTNA and United Auto Workers union members at its New River Valley plant on a new five-year contract. The terms of the agreement that extends from March 17, 2016, until March 16, 2021, weren’t released. The vote count also wasn’t disclosed.
Attempts to reach the UAW for comment on the latest announcement were unsuccessful.
Earlier this year, VTNA announced it expected to lay off about 730 workers in February. That number turned out to be around 500, Mies said.
