STOCKHOLM: Sweden's Volvo, the world's second-largest truck maker, said Tuesday that bottom-line profits fell sharply in 2016, hit by a decline in sales in North America.
Volvo said in a statement that net income for the year fell by 12.4 percent to 13.2 billion kronor (1.4 billion euros, $2.0 billion).
Overall group sales contracted by three percent to 301.9 billion kronor.
"The decrease was primarily an effect of the slowdown in the North American truck market, which was partly counterbalanced by improving demand for the Group's products in Europe and Asia," it said.
While revenues were up nine percent in Europe and four percent in Asia, they plunged 21 percent in North America and 11 percent in South America.
"In Europe, truck demand continues to be high due to good freight volumes combined with low fuel prices and interest rates that support our customers' profitability," said chief executive Martin Lundstedt.
He said Volvo Trucks improved its market share to a "historically high level" of 16.9 percent, while its subsidiary Renault Trucks came in slightly lower than the previous year at 8.1 percent.
"The downward correction in the North American highway segment continued, but with some signs of stabilisation as the industry's inventory of new trucks came down to more healthy levels," said Lundstedt, who was hired from rival Scania in 2015.
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