Volvo Trucks to Take $780 Million Charge Over Emissions Flaw
- Swedish company plans to book the provision in fourth quarter
- Shares rise as investors had feared a bigger financial impact
Source: Volvo
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Volvo AB, the world’s second-largest truckmaker, will set aside 7 billion kronor ($780 million) to address a faulty emissions-control component that’s worn out more quickly than expected.
The charge will eat into operating income in the just-finished fourth quarter, while the drag on cash-flow will impact the coming years, the Gothenburg, Sweden-based manufacturer said Thursday in a statement issued after trading closed in Stockholm. Citigroup said the size of the provision was “better than feared,” and Volvo shares gained as much as 2.3 percent.