Volvo Construction Equipment has seen a 30% sales increase to $1.84 billion in the first quarter of 2017, citing improved market conditions in all regions of the world except South America as the motivation behind the boost in sales, order intake, profitability, and deliveries.
Read on to learn more about Volvo’s success and why we’re so proud to offer their equipment!
Q1 2017: By the Numbers
Volvo reports an increase in operating income of $38.7 million, reaching a total of $183.5 million on an operating margin of 10%. This was a drastic rise from the 2.7% operating margin during the same quarter the previous year. Order intake increased by 34% in Q1, with 17,487 machines ordered. The increase happened in all markets, but particularly in Europe and China. Deliveries also increased 34%, to 16,369 machines.
Q1 showed continued growth for the construction equipment market in all regions except South America. Increased demand in Germany, France, and the UK drove the European market up 17%. North America rose 1% due to the offset of low demand in other areas being balanced out by improvements in compact equipment and large excavators.
Asia’s increase was 10%, not including China, who continues to recover with a 48% market growth rate during the first quarter compared to the same period in the previous year. This boost can be traced to a surge in demand for excavators, which saw a 99% increase during Q1.
A recovering minor sector drove growth in Indonesia, while Turkey and the Middle East both saw a reduction in demand.
Volvo’s Response to Q1 Success
Martin Weissburg, president of Volvo CE, had an excellent response to these statistics: “After years of tough market conditions, the Volvo CE business is growing again. Higher sales volumes linked with increased internal efficiency and a lower cost base helped us deliver good profitability levels during the quarter. Volvo CE is on the right track, the improvement plan is yielding results and there are further opportunities to improve the long-term competitiveness of the company.”
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