Volvo Cars has announced an operating profit (EBIT), excluding joint ventures and associates, of SEK 8.2 billion for the second quarter of 2024. This figure marks the highest-ever profit for a single quarter and represents a 28% increase compared to the same period in 2023.
The company’s core EBIT margin also reached a new high of 8.1%, up from 6.3% in the previous year. This improvement is attributed to Volvo’s disciplined pricing strategy, rigorous internal cost control, and sustained sales growth.
Global retail sales saw a year-on-year increase of 15%, with 205,400 cars sold in the quarter. The sales surge was primarily driven by Volvo’s electrified vehicles, including both plug-in hybrids and electric cars, which experienced a 43% increase in sales compared to the same quarter last year.
Notably, 48% of Volvo’s global sales volume during the quarter comprised plug-in hybrid (PHEV) and fully electric (EV) cars. The share of EV-only sales rose to 26%. The strong demand for Volvo’s electrified models was highlighted by the EX30 small SUV ranking among the top three best-selling EVs in Europe, while the XC60 plug-in hybrid continued to lead PHEV sales in the region.
The EX30’s popularity in Europe and other markets contributed to an increase in Volvo’s gross margins, which rose to 22.8% from 19.0% last year. Gross margins on EVs reached a new high of 20%, underscoring the company’s profitable transition towards electrification.
Revenue for the second quarter was SEK 101.5 billion, slightly down from SEK 102.2 billion in the same period last year. This decline was due to reduced income from contract manufacturing and a normalization of sales to rental companies. However, Volvo’s core operational revenues remained stable.
Jim Rowan, CEO of Volvo Cars, stated, “We delivered a strong second quarter performance in 2024 with record underlying profitability, demonstrating our ability to create value despite a complex geopolitical and economic environment. Our core operational momentum remains strong, thanks to our balanced strategy, product portfolio, and agility in responding to challenges.”
Rowan added, “Our brand values of safety and sustainability, along with our unique technology approach, continue to resonate with customers. We increased our market share in Europe to the highest level ever and grew our share in the US, while maintaining our position in China with pricing discipline.”
The year 2024 marks a significant milestone for Volvo Cars. Following the rollout of the EM90 MPV and the ramp-up of the EX30, the first customers will take delivery of the flagship fully electric EX90 SUV in the third quarter. Production of the EX90 began this quarter at Volvo’s South Carolina factory in the US.
The EX30, EM90, and EX90 models exemplify Volvo’s commitment to full electrification. Alongside its plug-in and mild hybrid cars, these EV models provide a balanced portfolio that bridges the transition to an all-electric future.
Volvo acknowledges that the shift to full electrification will not be uniform, as some consumers are not yet ready to go fully electric due to infrastructure limitations or the early withdrawal of government incentives. Therefore, the company’s diverse lineup of fully electric, plug-in, and mild hybrid models remains essential.
Looking ahead, Volvo Cars will continue investing in new models and enhancing existing ones. During its Capital Markets Day in September, the company will provide further details on its technological roadmap and upcoming models.
