Volvo Cars will cut 3000 jobs to reduce costs; CEO said - the decision is difficult, but important

Sweden's Volvo Cars has made the decision to cut 3,000 jobs through a program aimed at reducing costs. The company has made the decision considering the trade tensions and the economic uncertainty they bring to the automotive sector.

On Monday, the company announced it will eliminate around 1,200 workers among its employees in Sweden. Another 1,000 positions filled by consultants will also be eliminated at the same time. The majority of these workers will be laid off in Sweden.

The rest of the positions will be eliminated in other markets around the world. All the jobs eliminated are office roles. "The announcements today are tough, but they are necessary steps as we create a stronger, more resilient Volvo Cars," said Hakan Samuelsson, president and CEO of Volvo Cars.

"The automotive industry is going through a challenging period. To cope, we must improve our cash flow and structurally reduce our costs," he added. The company, owned by Chinese firm Geely, has 42,600 full-time employees.

Carmakers around the world have been facing a number of challenges in recent years. The major reasons for this include rising raw material costs, a decline in the European car market, and US President Donald Trump's imposition of a 25 percent tariff on imported cars and steel. Volvo Cars has its headquarters and product development office in Gothenburg, Sweden, and makes cars and SUVs in Belgium, South Carolina, and China.