Volvo CE's global machines sales drop and service solutions sales remain strong in Q1
Despite sales dropping 8% globally, South American and Asian markets continue to show promising growth
Volvo Construction Equipment continues to roll out new products and services, even as market decline impacted its earnings in Q1 of 2025.
Global sales dropped roughly 8 percent in the first quarter of the year for Volvo CE, compared to the same period last year. Although South America and Asia saw growth, lower numbers in Europe and North America are contributing to the shortfall. The reduction in sales is largely due to increased geopolitical and market uncertainty.
However, Volvo CE has maintained steady performance during this period and is still investing in new technologies to benefit users globally. Though machine sales are down for Q1, the company has seen a rise in service sales, demonstrating the increasing relevance of service solutions, and an overall increase in orders and deliveries.
Orders and deliveries increase during uncertain market landscape
In Q1 2025, net sales decreased by 8 percent to SEK 21.117 M (CAD 305 M). When adjusted for currency movements, net sales of machines decreased by 10 percent and service sales increased by 2 percent. Compared with Q1 2024, a negative brand, market, and product mix was partly offset by increased volumes, lower material costs, and an improved service business.
However, global deliveries rose 12 percent in Q1, driven largely by increases in South America, Asia, Africa, and Oceania, despite a drop in Europe and North America. Net order intake also increased by 24 percent with improvements in all markets except South America. In Europe, this increase was due to dealer inventory levels coming down and end buyer sentiment improving, and in North America, it was an effect of more normalized supply compared to the lower intake the previous year. Orders for SDLG-branded machines improved by 30 percent driven by the Chinese market.
Commitment to transformation continues
With the rollout of its new generation of articulated haulers and the introduction of the brand-new A50, Volvo CE has had a busy first quarter. Delivering on its digitalization transformation, Volvo CE also announced a partnership with software company Unicontrol to integrate its 3D machine control technology into Volvo excavators.
A major recent focus was the company's all-electric lineup at bauma, the highlight of which was the unveiling of the first electric articulated hauler of its size class, the A30 Electric, which will reach selected customers in Europe in 2026 alongside the new A40 Electric articulated hauler.
Market development
For the first quarter, the total machine market was stagnant compared to the previous year with Asia, including China, and South America growing while Europe and North America contracted. Compared to the historically high levels of the first quarter of 2024, Europe declined 18 percent as end buyer demand remained saturated, while North America declined 14 percent due to the repositioning of fleets and market outlook uncertainty.
The growth in South America was 12 percent, which was mostly driven by Brazil, but it also showed improvement in Argentina and Chile. The Chinese market improved by 42 percent due to governmental policies to stimulate the real estate and construction segments. In Asia, outside of China, the market was up slightly by 1 percent thanks to growth in Indonesia and South Korea.
Melker Jernberg, head of Volvo CE, says: "As a global company we are understandably affected by these turbulent times, but we have shown resilience in the face of uncertainty and maintained a solid performance today while moving in the right direction for tomorrow. Our industry's transformation may be slower than we would like, but our commitment remains strong as we continue to invest into building a better world for all — as demonstrated by our pioneering 100 percent zero-emission lineup at the recent bauma show."
