Volvo to cut 1,620 more staff as downturn bites

STOCKHOLM (Reuters) - World number two truckmaker Volvo said on Tuesday it had given notice to 1,620 employees at its Swedish operations as it sought to adjust to weaker market demand.

A spokesman for the company said 1,020 employees had been given notice of redundancy within its Volvo Trucks business while a further 600 employees had been given notice at its powertrain unit.

"It boils down to weak order intake and we have customers that in the present environment don't dare place orders due to the uncertainty," Volvo spokesman Stefan Karlsson said.

"And we have no signs of improvement."

The layoffs announced on Tuesday were the latest in a series cuts that has seen the company shed thousands of jobs in reaction to a sharp fall in demand across most of its key markets amid the fallout of the global financial crisis.

Late last year, Volvo said it would cut more than 2,000 jobs in its European truck business as well as 1,350 jobs in its construction equipment business.

Karlsson said the cuts unveiled on Tuesday at the group, which manufactures heavy-duty trucks under the Renault, Mack, Nissan Diesel and Eicher brands, as well as its own name, affected its units in the Swedish towns of Gothenburg, Umea, Skovde and Koping.

"It was more or less a given that there would be some more (cuts) and I don't think one should count on this being the last of them either," Nordea analyst Johan Trocme said.

Volvo shares were down 4.1 percent to 37.9 crowns by 1:52 p.m. British time, underperforming a 1.7 percent fall in the Stockholm bourse's blue chip index.

(Reporting by Johannes Hellstrom; Writing by Niklas Pollard; additional reporting by Veronica Ek; Editing by Hans Peters)