Weakening demand in Europe has prompted Volvo to temporarily idle its primary vehicle assembly plant in Sweden later this month.
The Chinese-owned Swedish automaker says that its Torslanda, Sweden, assembly plant located just outside Gothenberg, will be shut down from October 29 to November 2 in response to weak demand.
Volvo says that it will not be laying off any full time workers as a result of the production cuts. Full time workers will also receive full pay during the production stoppage. Earlier this month, the automaker trimmed back the number of cars it produces in Torslanda from 57 to 50 per hour.
The automaker builds its larger, P24 platform-based vehicles in Torslanda, the XC90, XC60, S80 and XC70, as well as the midsize V60.
The primary source of Volvo's slowing global sales is in Europe, where the economic picture remains bleak. Austerity measures in southern Europe have essentially curtailed consumer spending, while buyers remain cautious in the comparatively robust nations of northern and central Europe. Volvo's biggest European market is Sweden, where it sold about 58,500 cars last year.
The U.S. market
In the United States, the automaker's single largest new car market, sales through the first nine months of the year have been essentially flat.
A new all-wheel-drive, five-cylinder version of the company's highest-volume sedan, the S60, is just arriving in dealers, and Volvo management has told Leftlane that it anticipates a hefty uptick in demand for the more winter-ready variant. However, the company's lineup remains limited and most sales are centered around just two products - the S60 and its XC60 crossover cousin.