Volvo Loses Dozens Of Trillions Of Rupiah Due To Tariffs And Delays For Launching New Electric Cars

ES90. (Photo. Volvo Cars)

JAKARTA - Swedish automaker Volvo, now controlled by Geely Holding from China, announced that it will record a large loss of 11.4 billion Swedish krona (around Rp 19.5 trillion) in its second-quarter financial statements. This loss occurred due to problems with their two latest electric car models, namely ES90 and EX90, mainly due to import rates and launch delays.

According to a Reuters report on Tuesday, July 15, Volvo stated that it is currently unable to sell Volvo ES90, made in China, in favor of import rates. The profit margin for the same model is also under pressure in Europe for similar reasons.

"The cost of lowering this value mainly reflects adjustments in the expected volume and the planned life-cycle profitability related to the platform for EX90 and ES90 cars," Volvo said in a statement.

In addition to tariff problems, this decline in value also reflects significant past launch delays and additional development costs arising afterwards. Of the total amount, 4.0 billion krona is expected to affect sales costs, and most of the rest will affect the Litbang (R&D) line in financial reports.

Volvo Cars, which is scheduled to issue results in the second quarter on July 17, stated that the impact on their net profit in that period would reach 9 billion Swedish krona.