Skip to main content

Volvo CE president says 2012 was “reasonable year” despite lack of sales growth

Sharply reduced global demand for construction equipment in the final three months of last year led to Volvo Construction Equipment’s (CE) full 2012 year sales growing by less than 1%, compared to sales in 2011. Volvo CE sales reached US$10.037 billion (SEK 63,558mn) in 2012, compared to $10.028 billion (SEK 63,500mn) the previous year. Operating income was down to $911.7mn (SEK 5,773mn), from $1.075 billion (SEK 6,812mn) in 2011, operating margin was 9.1% in 2012, down from 10.7% 12 months earlier, and the
February 7, 2013 Read time: 2 mins
Pat Olney speaking at Volvo CE’s press conference at bauma China 2012
Sharply reduced global demand for construction equipment in the final three months of last year led to 2394 Volvo Construction Equipment’s (CE) full 2012 year sales growing by less than 1%, compared to sales in 2011.

Volvo CE sales reached US$10.037 billion (SEK 63,558mn) in 2012, compared to $10.028 billion (SEK 63,500mn) the previous year. Operating income was down to $911.7mn (SEK 5,773mn), from $1.075 billion (SEK 6,812mn) in 2011, operating margin was 9.1% in 2012, down from 10.7% 12 months earlier, and the order book value on December 31 2012 was 36% below that of the same point in 2011.

In Q4 2012, the softer world market, particularly in the mining sector, contributed to a 23% drop in year-on-year net sales to $1.985 billion (SEK 12,572mn), compared to $2.582 billion (SEK 16,354mn) over the same period of 2011. After adjustment for changes in exchange rates, net sales fell by 22%.

Despite the tough sales climate Pat Olney, president of Volvo CE, said 2012 as a whole had still been a “reasonable year”, with the construction equipment giant claiming to have extended its Chinese market leadership for wheeled loader and excavator sales.

Speaking of Volvo CE’s global trading, he added: “We sold over 78,000 machines, recorded the company’s second highest ever revenues and our proactive downturn management helped protect cash flow and profitability. We recognised the turn in the industry early, and the work undertaken to reduce pipeline inventories was successful.”

Olney said that company stock levels had been reduced by around 30% since last spring 2012 and were now in keeping with current demand.

In 2013, Volvo CE predicts overall global sales prospects to remain subdued, with Europe sales forecast to decline by 5-15%. Asia, excluding China, is expected to see a sales decline of 0-10%, while China, North America, South America and other markets are all predicted to see sales ranging from -5% to plus 5%.

For more information on companies in this article

Related Content

  • Deutz reports strong half-year results
    August 3, 2017
    German diesel engine maker DEUTZ is reporting strong half-year results, which it says will help the firm to invest in research and development into future powertrain solutions. The company says it has seen a marked increase in new orders and revenue as well as a significant improvement in free cash flow, while it has also benefited substantially from the sale of its former manufacturing site in Cologne. The company says that new orders in the DEUTZ Group increased by 18.6% to €803 million for the half-year,
  • Deutz reports strong half-year results
    August 3, 2017
    German diesel engine maker DEUTZ is reporting strong half-year results, which it says will help the firm to invest in research and development into future powertrain solutions. The company says it has seen a marked increase in new orders and revenue as well as a significant improvement in free cash flow, while it has also benefited substantially from the sale of its former manufacturing site in Cologne. The company says that new orders in the DEUTZ Group increased by 18.6% to €803 million for the half-year,
  • Volvo CE pursues American Dream
    May 4, 2012
    Volvo Construction Equipment has begun the first phase of the US$100million expansion of its site in Shippensburg, Pennsylvania. The initial works include the construction of a new America’s HQ office and demonstration centre. Incorporating the latest environmental building practices, the expansion is said by Volvo CE to be a visible sign of the company’s commitment to the North American market. The completed facility will also localise production of some of Volvo CE’s larger construction machines. These a
  • Volvo CE offers solution to convert L120 wheeled loaders to electric
    February 22, 2023
    Volvo CE is offering a novel solution to convert L120 wheeled loaders to electric