Published by Global Banking & Finance Review®
Posted on July 14, 2025
2 min readLast updated: January 22, 2026
Add as preferred source on GoogleVolvo Cars faces a $1.2 billion impairment due to tariffs and delays affecting ES90 and EX90 models, impacting profitability.
STOCKHOLM (Reuters) -Sweden-based Volvo Cars is booking a impairment charge of 11.4 billion crowns ($1.2 billion) in the second quarter related to its ES90 and upcoming EX90 models, due to tariffs and launch delays, it said on Monday.
The group, which is controlled by China's Geely Holding, said it is currently unable to sell its Volvo ES90, which is built in China, profitably in the United States due to import tariffs, while profit margins for the same model are also under pressure in Europe for the same reason.
"The charge primarily reflects adjustments in expected volumes and planned lifecycle profitability associated with the platform for the EX90 and ES90 cars," it said in a statement.
The impairment charge also reflects significant launch delays in the past and subsequent additional development costs, it said.
Out of the total amount, 4.0 billion crowns is estimated to impact cost of sales and the majority of the remaining amount affects the R&D line in the financial reporting.
Volvo Cars, which is due to publish second-quarter results on July 17, said the effect on net income in the period will be 9.0 billion crowns.
($1 = 9.6103 Swedish crowns)
(Reporting by Anna Ringstrom and Marie Mannes in Stockholm, editing by Essi Lehto and Tomasz Janowski)
Volvo Cars is booking an impairment charge of 11.4 billion crowns, approximately $1.2 billion, in the second quarter.
The charge is primarily due to import tariffs affecting the ES90 model and significant launch delays for the EX90 model.
Out of the total impairment charge, 4.0 billion crowns will impact the cost of sales, while most of the remaining amount will affect the R&D line in financial reporting.
Volvo Cars is scheduled to publish its second-quarter results on July 17.
The impairment charge is expected to affect net income by 9.0 billion crowns during the period.
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