Volvo CE has maintained profitability for 2024

    

Volvo Construction Equipment said that it maintained its strong profitability for the end of 2024, despite a year of declining sales. The firm says that it achieved a turnaround in the final quarter of 2024 with an order increase of 19%.

The company says that it was able to maintain profitability on lower volumes for the fourth quarter, following 12 months of lower sales. This was achieved in the face of a weaker market across many regions in the world. While net sales have dropped 16% in Q4, net order intake for the same quarter has risen 19%, driven by improvements in major markets across Europe, North America, Africa and Oceania.

South America has seen a growth in net sales of 19% and deliveries increased 29% for the last quarter, but overall global sales are down for the full year by the same Q4 drop of 16%.

In Q4, net sales decreased by 16% to SEK 22,197 million, compared to 26,578 million for the same period in the previous year, of which net sales of machines decreased by 19% and service sales decreased by 2%. Adjusted operating income amounted to SEK 2,609 million, compared to  3,320 million for the previous year. This corresponds to an adjusted operating income of 11.8%, compared with 12.5% for the previous year. For the full year 2024, net sales dropped by the same 16%, amounting to SEK 88,305 million, compared with 104,981 million for the previous year. Adjusted operating income amounted to SEK 12,737 million, compared to 16,993 million for the previous year.

Volvo CE says that it is maintaining a more positive outlook coming into 2025, following a year of milestone investments and pioneering new product launches, continuing with its largest product portfolio overhaul in decades. 

Melker Jernberg, president of Volvo CE, said: “Despite lower volumes, we have been able to maintain a healthy profitability, whilst at the same time introducing new products and services, including a new range of articulated haulers to our existing portfolio.

“As we navigate challenging market conditions, we stand firm in our commitments and continue to invest. This last quarter has seen us move forward with our biggest launch year ever, balancing tomorrow’s innovations with our customers’ needs for today. 2025 will see us continue with these exciting developments, strengthened by an incredible performance from all our employees around the world.”

New excavator models were rolled out, including the EC650 in China and the EC300 in South Korea, while in Europe, the latest generation of excavators was expanded with the launch of three mid-size crawler excavators. This month, a comprehensive range of industry-leading articulated haulers was launched. The updated range consists of seven models, including one completely new model, the A50.

Compared with the historically high levels in Europe and North America for the final quarter of 2023, the total machine market contracted in these regions, largely due to a saturated end customer demand in Europe, resulting in a 25% drop, and a normalisation of replenished dealer and rental fleets in North America, prompting an 8% drop.

However, South America saw a 5% increase thanks mainly to improvements in Brazil, while government policies to stimulate the real estate market were the main driver for market growth in China (6%). Asia, excluding China, was flat with lower development in Southeast Asia, South Korea and Turkey, while markets in India and the Middle East grew.