Volvo Financial Services‘ new retail financing volume rose in the third quarter as the captive lender expanded its portfolio despite elevated delinquencies and write-offs.
The Gothenburg, Sweden-based financing arm of Volvo Group reported new retail financing volume of 28.5 billion Swedish krona ($2.9 billion), up 10% year over year, according to the manufacturer’s earnings release today.
Profitable portfolio growth helped lift Volvo Financial Services’ (VFS) operating income, although higher selling expenses and credit provisions partially offset those gains, according to the company’s quarterly report. Portfolio performance remained stable despite elevated delinquencies and write-offs.
By the numbers
Volvo Group reported these Q3 results:
- Total financed units on a 12-month rolling basis declined 0.8% YoY to 67,037;
- Its net credit portfolio for the first nine months of the year grew 4% YoY to $28.4 billion;
- Credit provision expenses increased 3.4% YoY to $39.2 million;
- Financing penetration on a 12-month rolling basis was 30%, down 1 percentage point YoY;
- North American truck orders increased 18% YoY to 11,150 units; and
- North American construction equipment orders jumped 80% YoY to 1,960 units.
State of play
Demand for trucks and construction equipment continued to improve in North America and Europe, supported by fleet replacement needs, Volvo Group President and Chief Executive Martin Lundstedt stated in the earnings report.
Infrastructure investments, data center construction and energy projects contributed to North American construction equipment demand, according to the report.
Volvo Group maintained its 2026 North American heavy-duty truck market forecast of 265,000 units and projects 300,000 units in 2027.
Volvo shares (OTC: VLVLY) were at $30.80 at market close today, down 2.4% or 77 cents from market open. The company has a market capitalization of $63 billion.
Editor’s note: All amounts have been converted to U.S. dollars.
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