In May, Volvo announced it would work on an IPO proposal in Stockholm, and recently predicted that these supply issues would continue through the end of the year.
Due to the current supply crisis that is affecting the business, Volvo Cars, owned by the Chinese company Geely, reported significant half-year results Friday.
This supply problem should continue in the second half, according to the Swedish flagship, which announced an IPO in May.
“The global shortage of semiconductors has had an impact on the entire automotive industry and Volvo Cars has been no exception. A real recovery is not expected until 2022, with an even longer delay for the most advanced semiconductors,” the automaker said in its report.
Volvo Cars grew its sales by 26.3% in the January-June period to 141 billion kroner (about $15.5 billion), returning to profit at 8.2 billion after a half-year of losses due to the Coronavirus outbreak.
Volvo Cars sold 380,757 vehicles, a 29% year-over-year increase from 340,826 in the first half of 2019.
Unless the semiconductor supply improves, Volvo expects the second half of the year to match the second half of 2020.
The group anticipates “continued sales and revenue growth” for the full year.
The company claims that this growth, in conjunction with continued cost management, should lead to profit levels comparable to those pre-pandemic.
Volvo announced earlier this week that it is purchasing the Chinese interests of parent company Geely Holdings in their joint ventures, at a time when an IPO in Stockholm is being considered.
The deal, seen by analysts as a move to boost Volvo’s image ahead of a possible IPO, now gives the automaker full control of its car manufacturing plants and sales operations in China.
Since its acquisition from Ford in 2010 by Chinese Geely, Volvo Cars has dramatically improved its accounts and its high-end brand image, despite its new ownership. The company has also specialized in autonomous cars, where it is currently ranked among the leading players.
The Swedish carmaker, which weathered the Coronavirus crisis well in 2020 with a solid recovery in the second half of the year, also aims to become all electric by 2030.