Volvo Trucks' January Results Promising

Swedish truck manufacturer volvo trucks has announced results for January indicating a promising outlook for 2011. The company's published figures revealed a 62 per cent increase in sales in January, resulting in 15,277 trucks sold. The news adds weight to the hope of a recovery for the commercial truck market htis year.

The highly cyclical heavy-duty truck market has picked up strongly in recent quarters with growth spreading out of emerging markets in Asia and Latin America to mature markets on both sides of the Atlantic.

Volvo, which also sells used volvo trucks and trucks under the Eicher, Mack, Renault, and UD Trucks brands, said unit shipments rose 78 percent in Europe, its biggest market, while they were up 83 percent in North America. In Asia, further down the road to recovery than markets on either side of the north Atlantic, deliveries rose 51 percent.

"It is pretty much exactly as expected and means they held roughly the same production rate in January as they had in December," Handelsbanken analyst Hampus Engellau said.

"This confirms that we are seeing a cyclical recovery in North America, but also that Europe is really stronger than anticipated."

Volvo shares opened up 0.5 percent to 111.5 crowns, to narrowly outpace a 0.1 percent gain in the DJ Stoxx autos sector index shares in rivals Scania and MAN rose 0.6 percent.

The group, second globally to German group Daimler, earlier this month raised its demand outlook, saying it expected markets to grow to about 220,000 units in both Europe and North America, implying double-digit growth.

Gothenburg-based volvo trucks, which also manufactures buses, construction equipment and engines, has seen earnings recover on the back of the strong demand but also encountered production problems as it tries to raise output.

Volvo's deliveries shifted gear toward the end of last year with year-on-year increases of about 60 percent as demand began reviving in North America, the market hardest hit by the downturn in the wake of the global financial crisis.