Volvo said stretched components supply had continued to have an impact in the third quarter, but with a 13 percent rise in truck deliveries and sharply higher earnings in its construction equipment arm, this was shrugged off.
CEO Martin Lundstedt, a former boss at rival Scania, said the bottlenecks that had mainly hit European truck manufacturing had eased somewhat in recent months, along with supplies of components for powertrains, or engines and axles.
“Still there is obviously a high level of pressure in the supply chain, but if you look through the quarter and after the vacation period it has been a continuous improvement, and we continue to see that,” Lundstedt told a news conference.
Volvo’s adjusted third-quarter operating profit rose to 7.02 billion Swedish crowns ($861 million) from 4.85 billion a year before, beating a mean forecast of 6.20 billion seen in a poll of analysts.
“There are really no negatives here,” Engellau said. “Construction Equipment is really strong and the trucks business continues to deliver in a seasonally weak quarter.
“Also order intake is extremely strong and it seems demand will accelerate even further ahead.”
Volvo has begun reaping the benefits of a 10 billion crown cost-cutting drive and in August set a target to reach its highest profitability since the sale of its car making arm to Ford nearly two decades ago.
Gothenburg-based Volvo said order intake of trucks at the group, which also includes brands such as Mack, Renault and UD Trucks, grew 32 percent in the quarter, beating the 15 percent rise seen by analysts.