Volvo Cars is restructuring its operations in the U.S. and Canada to optimize spending and prepare for the electric vehicle era.
Volvo’s restructuring is a part of an $88 million global initiative called Core+ which aims to boost efficiencies and modernize the workforce.
Volvo plans to affect over 10% of its white-collar workforce in the U.S. and Canada, with the changes expected to be in place by early October.
As a part of the brand’s future vision, Volvo has launched a new technology hub in Singapore and a tech center in Krakow, Poland.
Volvo Cars is undertaking a significant restructuring of its operations in the U.S. and Canada. This decision is aligned with a larger $88 million worldwide initiative, termed Core+, aimed at enhancing spending efficiency, streamlining operations, and reorienting the workforce for the impending electric vehicle (EV) age.
Michael Cottone, the President of Volvo Cars USA and Canada, emphasized that this initiative would be comprehensive, with virtually every business facet undergoing scrutiny. The objective is to focus on areas that maximize impact. As a part of this process, Volvo is slated to reduce its white-collar workforce in the U.S. and Canada by over 10%. This will be achieved through a combination of job cuts and early retirement incentives, with the majority of these changes expected to be implemented by October.
Several facilities, including Volvo’s Silicon Valley Tech Center and its Southern California design center, are experiencing downsizing as operations get consolidated at other global locations. In a noteworthy move, the company has inaugurated a technology hub in Singapore dedicated to data analytics, software development, and advanced manufacturing. Additionally, a tech center has been established in Krakow, Poland, earlier this year.
While company spokesperson Russell Datz refrained from delving into the specifics of the restructuring, he confirmed the operational downsizing of the technical center. Notably, this facility has witnessed considerable expansion since 2018.
This global revamp, championed by Volvo Cars CEO Jim Rowan, coincides with the automaker’s aggressive shift towards battery-powered vehicles, aiming for a complete transition by 2030. The company’s vision is to have full-electric models make up 50% of its projected 1.2 million sales by 2025. This will necessitate the introduction of a new EV each year until mid-decade. Rowan elaborated that the restructuring is not just about cost-cutting. The focus is on cultivating a culture of cost-consciousness by innovating and operating more efficiently.
As the EV era dawns, Volvo is also emphasizing the upskilling of its workforce, focusing on areas like software development, machine learning, and artificial intelligence. The company is also keen on in-house development of EV powertrains, thus seeking experts in fields like battery chemistry. This ongoing restructuring, however, will not influence Volvo Cars’ global manufacturing network.