Home / Volvo Cars News: Major Job Cuts and AI Upgrades in 2025

Volvo Cars News: Major Job Cuts and AI Upgrades in 2025

By: Jasmin Espinas
May 27, 2025

Volvo Cars is repositioning itself in the global automotive industry, balancing its legacy of safety and design with an increasingly tech-driven strategy. In recent Volvo Cars news, the company has cut 3,000 positions to reduce costs.

This update also discusses Volvo’s investment in AI, the new Volvo XC70, financial adjustments after Q1 2025 results, and the appointment of a new CFO.

Latest Volvo Cars News: 3,000 Job Cuts As Part of Global Restructuring

Volvo Cars is cutting 3,000 positions to reduce costs amid increasing economic pressure tied to global trade disputes and material inflation. The company announced the decision on May 26, confirming that around 1,200 of these roles will be eliminated in Sweden.

Approximately 1,000 consultant contracts, primarily based in Sweden, will also not be renewed. The remaining cuts will come from various international markets, mainly affecting administrative and support roles.

🚨 LAYOFF ALERT – 🌎

Volvo Cars is laying off 3,000 employees globally, citing cost-cutting efforts amid trade tensions and economic uncertainty. The move comes as the industry faces pressure from 25% U.S. tariffs on cars and steel, rising raw material costs, and a shrinking… pic.twitter.com/pdmJXEKjuM

— The Layoff Tracker 🚨 (@WhatLayoff) May 26, 2025

CEO Håkan Samuelsson acknowledged the move’s difficulty but emphasized its necessity.

He stated that the changes are critical to improving cash flow and lowering structural costs since the industry is under strain from multiple directions.

Volvo Cars, currently owned by China’s Geely, employs 42,600 full-time staff globally. Production facilities are located in Belgium, South Carolina, and China, with corporate and R&D operations headquartered in Gothenburg.

The decision follows broader industry pressures, including weaker European demand and rising raw material costs. Plus, the impact of U.S. tariffs on imported vehicles and components.

Volvo Cars News: Google Gemini AI Is Coming to Volvo Vehicles

Volvo Cars announced on May 21 that it is extending its collaboration with Google to speed up the rollout of Android Automotive OS features.

As part of this expanded agreement, Volvo will integrate Google Gemini AI into select models, which debuted the technology during Google I/O 2025.

The company will now serve as one of Google’s reference hardware platforms for in-vehicle Android development.

Gemini will replace the current Google Assistant in vehicles equipped with Google built-in. Unlike basic voice commands, Gemini allows more natural interactions, such as composing and translating messages, retrieving vehicle manual details, and asking location-based questions.

These features are designed to help drivers stay attentive without needing to look away from the road.

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Patrick Brady, Google’s Vice President of Android for Cars, said the enhanced partnership will bring faster innovation to market while improving the overall driving experience.

By acting as a lead hardware platform, Volvo will also influence future Android experiences inside the vehicle

Volvo Cars News: Meet the XC70, Volvo’s Longest-Range Plug-In Hybrid

In another Volvo Cars news, the company is preparing to launch the new XC70, a mid-size SUV built on its SMA platform. This fully electric vehicle offers a range of up to 200 kilometers, marking Volvo Cars’ longest-range plug-in hybrid to date.

The model was developed to meet the rising demand for extended-range hybrids in China, and availability is planned later this year. Volvo is also evaluating other potential markets but has not confirmed additional regions.

CEO Håkan Samuelsson described the XC70 as a strategic move toward full electrification for customers who want lower emissions and daily electric driving.

The car combines a fast-charging battery system with a combustion engine, giving it the flexibility to handle emission-free long-distance travel.

Additionally, the exterior reflects Volvo’s focus on clean lines and functionality. The front includes a closed grille inspired by its electric range, paired with an active shutter system that improves efficiency by adjusting airflow.

Meanwhile, the Thor’s Hammer running lights now feature adaptive Matrix LED technology, automatically adjusting based on driving conditions.

At the same time, the vehicle’s rear showcases vertical taillights embedded directly into the glass, giving it a clean finish without sacrificing visibility.

The new XC70 takes its name from an earlier Volvo model known for its practicality and rugged character. This latest version follows that lineage, offering more interior space than the XC60.

It also targets families seeking a capable, low-emission SUV with enough range and flexibility for daily use and extended travel.

Volvo Q1 2025 Financial Results Show Lower Sales and Revenue

Volvo Cars released its Q1 2025 financial results on April 29. The company reported a 6% drop in retail sales compared to the same period in 2024 and sold 172,219 vehicles during the quarter.

The decline in volume, along with unfavorable currency exchange rates and a 19% reduction in wholesale volumes, contributed to a 12% decrease in revenue. These numbers follow last year’s inventory reduction efforts, which carried over into early 2025.

Despite the weaker topline, Volvo improved its free cash flow. The gain was supported by better working capital management and divesting its stake in Lynk & Co.

In addition, the company continues to push forward on electrification, with 19% of Q1 vehicle sales being fully electric. This number remains the highest share among its established premium competitors.

Combined, fully electric and plug-in hybrid models accounted for 43% of all sales in the quarter.

The quarter also saw the debut of the ES90, Volvo’s next fully electric, software-defined model. As the company expands its EV offerings, its plug-in hybrids remain an option for buyers transitioning to fully electric vehicles.

Even with lower volumes and increased pricing pressure, Volvo Cars maintains its long-term goal of becoming a fully electric brand.

To counter profitability pressure, the company has rolled out a cost and cash efficiency plan. However, given current market instability, it has withdrawn its financial guidance for 2025 and 2026.

Volvo states it will continue to prioritize long-term growth by focusing on product development, operational efficiency, and financial discipline.

Fredrik Hansson Appointed as New Volvo Cars CFO

After Johan Ekdahl’s departure, Volvo Cars has named Fredrik Hansson as its new Chief Financial Officer.

The announcement on April 24 places Hansson in a central leadership role as the company adjusts to heightened global economic uncertainty and evolving industry demands.

Hansson steps into this position after serving as Head of Global Controlling and Performance Steering since 2021 and Deputy CFO since 2023.

Hansson’s responsibilities span global controlling, corporate finance, treasury, accounting, tax, and investor relations.

As part of the executive management team, he will contribute to the organization’s long-term strategic planning and financial oversight.

Volvo is positioning him to help stabilize operations and support its transition goals, particularly in electrification and digital infrastructure investments.

Before joining Volvo, Hansson was a partner at McKinsey & Company, advising clients on corporate strategy, digital transitions, and operational efficiency.

He also worked closely with Volvo Cars during that time, giving him direct insight into the company’s financial framework and business priorities.

Commenting on his new role, Hansson acknowledged the challenges ahead and emphasized his focus on supporting the leadership team in navigating this period of change while reinforcing the company’s financial position.

Conclusion

Volvo Cars enters the second half of 2025 facing slower volumes, cost pressures, and shifting global policies. At the same time, it is advancing its electric transition, expanding AI integration, and adapting its financial structure through leadership changes and operational adjustments. These developments position the company to manage uncertainty while maintaining a forward trajectory.

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