EBIT was SEK5 billion (US$487.37 million) and the EBIT margin for the period was 6.3%. The result came despite a SEK900 million (US$87.73 million) non-recurring item related to the redundancy programme announced in May, when the company eliminated 1,300 office-based positions in Sweden.

Volvo Cars achieved revenue of SEK102.2 billion (US$9.96 billion) in the quarter, up by 43% year-on-year, with a global sales increase of 25% to 178,800 cars.

The company reported that it produced 50% more cars in the second quarter than in the same period of 2022, which it attributes to its efforts to create a more resilient supply chain, including broadening its supplier base, improving performance and delivery from its suppliers, developing direct relationships with key semi-conductor companies and foundries and creating more transparency in the overall value chain.

Efforts were also made to reduce the carbon footprint per vehicle and Volvo reports that it reduced overall CO2 emissions per car by 18.8% in Q2 compared with its 2018 benchmark, with the aim of reaching a reduction of 40% per car by 2025.

Electric cars were a highlight for the brand in the period, with sales of fully electric Volvo car models increasing by 178% and accounting for 16% of its total sales. However, the company noted that margins on fully electric cars were impacted in the quarter by high lithium prices.

Looking forward, Volvo expects supply and demand to continue to normalise in the wider market and notes that demand for its cars continues to be healthy despite rising interest rates and pressure on consumers.

Assuming no unexpected disruptions, the company is forecasting a double-digit sales increase for the full year and for the share of fully electric car sales to top 2022’s result of 11%.

President and CEO Jim Rowan said: “The second quarter of 2023 shows that the year is shaping up as planned. In these past three months we have continued to deliver on our ambitious transformation goals and made steady progress. At the same time, we also achieved a solid underlying business performance with increased sales and revenues. We are performing and transforming, while navigating the external challenges that have come our way.”