Volvo Cars' goal to sell 800,000 vehicles globally by 2020 was derailed by the pandemic and by the semiconductor shortage in 2021. Despite the setbacks, CEO Hakan Samuelsson believes that topping Volvo's sales record of 705,452 vehicles set in 2019 is "within reach," even though the automaker took a big hit to production in the third quarter. Samuelsson also outlined the lingering effects of the pandemic on Volvo's business and shared how the newly listed automaker will consistently achieve a profit margin of 8 to 10 percent in an interview with Automotive News Europe Managing Editor Douglas A. Bolduc.
What is your outlook for the rest of 2021 and 2022?
That is a difficult question because of the semiconductor shortage. We had good momentum, then coronavirus outbreaks in the Far East closed down some of our component suppliers, including those providing semiconductors. As a result, we lost production of about 50,000 vehicles. We offset this by really reducing our stock levels; therefore the actual registrations loss was about 30,000 compared with last year. But now the dealer stock is very low because they have sold out everything they have. The fourth quarter definitely looks like it will be better, so the loss in production will be lower, but any losses will result in lost retail sales. Overall, things will be better in the final quarter of 2021, but they still will not be back to normal. For the full year, we will sell more cars than last year, and we will improve our profitability. By the first quarter of next year, we should be back on track with only minor disruption from the chip shortage. It's too early to say what that will mean for the full-year results in 2022.