Volvo Cars Announces 2021 Financial Report, Net Profit Surges 82% Year-on-Year

On February 11, Volvo Cars announced record revenue and profit for 2021. Consumer demand for the company's cars remains strong despite continued shortages of automotive parts, the company said.

(Image source: Volvo Cars)

Specifically, Volvo Cars' revenue in 2021 increased from SEK 262.8 billion in the previous year to SEK 282 billion, an increase of 7%. Operating profit increased by 138% year-on-year from SEK 8.5 billion to SEK 20.3 billion, with an operating margin of 7.2%. Net profit increased by 82% year-on-year from SEK 7.8 billion to SEK 14.2 billion.

"2021 is a proud year for Volvo Cars," said H kan Samuelsson, CEO of Volvo Cars, "despite the continued shortage of parts supply in the automotive industry, our global market share has increased and we have achieved unprecedented revenue and profit margins. ”

In the fourth quarter of 2021 alone, Volvo Cars' revenue was SEK 80.1 billion, down 6% year-on-year, and while consumer demand and orders have been strong, car production has been limited by chip shortages. Operating profit for the quarter was SEK 3.7 billion, representing an operating margin of 7.1%.

Volvo Cars' sales in the fourth quarter of 2021 fell by 20% compared to the same period in 2020. The company's electrified range continues to be popular with customers, with the "Recharge" series accounting for 34 percent of the company's global sales in the fourth quarter of last year, plug-in hybrids accounting for 28 percent of Volvo's total sales, and pure electric vehicles accounting for 6 percent of total sales.

As Volvo Cars increases its annual production capacity of pure electric vehicles to 150,000 units, the company's proportion of pure electric vehicles in total sales will double from 2021.

Looking ahead, uncertainty in the automotive industry remains high. While parts shortages have eased, supply chains are expected to remain a constraint. At the same time, Volvo Cars continues to see strong customer demand and expects electric vehicles to grow faster than the overall market, which will allow the company's sales to continue to grow in 2022.