Truckmaker Volvo hit by semi-conductor shortage, sees negative impact on earnings and cash flow

FILE PHOTO: IAA truck show in Hanover

STOCKHOLM (Reuters) – Swedish truckmaker Volvo said on Monday that a shortage of semiconductors would have a substantial impact on production in the second quarter.

The firm said it will implement stop days across its global truck manufacturing operations in the beginning of the quarter.

“In total, these are currently estimated to between two and four weeks depending on production site,” Volvo said in a statement.

Volvo said visibility into the global supply chain of semiconductors was very low and that the uncertainty about the development was high. It said the disturbances were also expected to impact the firms other business areas.

“The disturbances are expected to have a negative impact on earnings and cash flow,” it said without giving further details.

Volvo said in February the semiconductor shortage had hit production in Ghent, Belgium, and warned of further disruption.

Earlier this month, rival Scania, part of Volkswagen AG’s commercial vehicle arm Traton SE, said it might have to stop production due to the semi-conductor shortage.

(Reporting by Johan Ahlander)