Volvo’s Q3 profit tops forecasts, sees growth

Volvo’s Q3 profit tops forecasts, sees growth

Stockholm: Volvo, the world’s second-biggest truck maker, reported a bigger than expected swing back into profit in the third quarter and maintained its forecast of strong market growth in Europe and North America.

Volvo and rivals such as market leader Daimler have seen the highly cyclical demand for heavy-duty trucks pick up in recent months after weathering the worst downturn in decades in the wake of the global financial crisis.

The Swedish firm said on Friday it made an operating profit of 4.9 billion crowns ($736 million) in the quarter having lost 3.3 billion in the same period last year. Analysts had on average forecast a profit of 4.3 billion crowns, according to a Reuters poll.

The recovery has been led by booming growth in emerging markets in Latin America and Asia, but the truck markets on both sides of the Atlantic have also lifted off the lows hit during the crisis as the broader economy has gradually improved.

Volvo, which makes heavy-duty trucks under the Renault, Mack, UD Trucks and Eicher brands, repeated its forecast for the truck market to grow about 10% in Europe this year and 20-30% in North America.

The company also said it expected market demand to rise further next year and reach a level of above 200,000 vehicles in both North America and Europe, though it cautioned that austerity measures in the region could hold back growth.

Gothenburg-based Volvo, which also manufactures buses, construction equipment, engines and aerospace components, said order bookings for its trucks rose 59% year-on-year in the third quarter.