Volvo expects low growth as Volkswagen sees profits slump

 
City A.M. Reporter
WORLD number two truck maker Volvo said yesterday it expects no growth in European and US markets next year, as Europe’s biggest auto maker Volkswagen revealed its third-quarter profit had fallen by a fifth.

Volkswagen’s operating profit dropped to €2.34bn (£1.89bn) in the third quarter from €2.89bn a year earlier, the company said.

That was in line with analyst expectations, though, and they expect profits to rebound when VW starts to reap the benefits of its technology revamp.

Volvo, meanwhile, said third-quarter orders had fallen 25 per cent from a year ago, more than market forecasts for a 17 per cent fall. Operating profit slumped to 2.9bn crowns (£271.5m) from a year-ago 5.8bn crowns, well below a mean forecast for 4.5bn crowns.

For 2012, Volvo stood by its outlook for all markets, implying an industry-wide contraction of about five per cent in Europe.