© Reuters. File photo: On May 28, 2020, in a showroom in Brussels, Belgium, an employee of a Volvo car dealer wears a protective mask. REUTERS/Yves Herman
STOCKHOLM (Reuters)-Sweden-based carmaker Volvo Car Group warned on Friday that after being forced to cut production due to material shortages, sales in the second half of 2021 may fall year-on-year.
The automaker under China’s Geely Holding said that despite strong potential demand, sales in August fell by 10.6% year-on-year, and warned that the potential decline in sales in the second half of the year may affect revenue and profits.
“But Volvo Cars’ outlook for the full year of 2021 remains,” it said in a statement, referring to its forecast of sales and revenue growth, and profitability will increase to pre-pandemic levels.
Volvo Cars said that supplier closures since mid-July-due to local efforts to limit the spread of highly contagious Delta models in Southeast Asia-have exacerbated the already tight supply situation and forced it to stop production.
The global chip shortage in the past year has caused serious delays in manufacturing activities and has forced several automakers to reduce production.
The company is considering listing on the Nasdaq Stockholm stock exchange this year. In August, global sales fell to 45,786 vehicles, European sales fell 25%, and US sales increased 3%.
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