Volvo Cars Restructures Operations in the U.S. and Canada to Prepare for an All-Electric Future
Volvo Cars is undergoing a major restructuring of its operations in the U.S. and Canada, as part of a global effort to drive efficiency, tighten spending, and prepare for the shift towards all-electric vehicles. This initiative, known as CORE+, encompasses all areas of the business, ensuring that resources are focused on the most impactful aspects.
The Swedish automaker plans to reduce its white-collar workforce in the U.S. and Canada by over 10%, affecting nearly 1,000 employees. The company will also offer early retirement options to further streamline its regional ranks. The headcount reduction is expected to be completed by early October.
As part of the restructuring, Volvo is consolidating its work to other locations globally, leading to downsizing of its Silicon Valley Tech Center and Southern California design center. However, the company is opening a technology hub in Singapore that will focus on data and analytics, software, and advanced manufacturing development.
The restructuring also extends to contractors, although Volvo has not provided details about the impact on them. The company has confirmed the scaling back of operations at its technical center, maintaining a smaller presence for autonomous driving testing and verification in the Sunnyvale hub.
Volvo’s Commitment to an All-Electric Future
This restructuring initiative aligns with Volvo’s ambitious goal of becoming a leader in the electric vehicle market by 2030. The company aims for electric models to constitute half of its projected 1.2 million sales by 2025, and plans to introduce a new full-electric car every year through the mid-2020s.
Other automakers, including Ford and General Motors, have also undergone corporate restructurings to accelerate the development of electric vehicles and other advanced technologies.
Volvo’s CEO, Jim Rowan, emphasizes that this initiative is not merely a cost-cutting program, but a cultural shift towards cost-consciousness and efficiency. The company believes that being proactive in managing costs and adapting to change early on will contribute to its long-term growth and success.
Reskilling the Workforce for the Electric Era
In addition to restructuring its operations, Volvo is focusing on reskilling its workforce to meet the demands of the electric vehicle industry. The company aims to bring in new skills related to software development, analytics, machine learning, and artificial intelligence. As Volvo takes on more of its own EV powertrain development, it plans to hire experts in battery chemistry, inverters, and silicon carbide.
The restructuring effort will not impact Volvo Cars’ global production network, including its assembly plant in Ridgeville, South Carolina. The company aims to maintain high output to keep up with the increasing demand for its vehicles.
While this restructuring may result in some short-term challenges, Volvo believes that it is necessary to allocate resources strategically and ensure the business is well-positioned for future growth. By focusing on the right areas and making the necessary investments, Volvo aims to continue its transformation and remain at the forefront of the automotive industry.
Note: Douglas A. Bolduc contributed to this report.
