Volvo Raises Truck Forecasts

Volvo Group raised its forecasts for registrations as the world’s second-biggest truck maker saw orders increase 32%. Volvo last week reported preliminary first-quarter results that prompted its shares to surge.

Pent-up need to replace aging fleets has buoyed demand, noticeably “on the truck side, where order intake rose as we gradually opened the order books for the second half,” Volvo CEO Martin Lundstedt said in a statement.

The upbeat start to the year followed persistent parts shortages finally easing, after the company resorted to restricting taking on new orders to help manage customer wait times and cost inflation. Volvo was also able to reduce helping sub-suppliers under pressure from the jump in energy costs in Europe. Volkswagen AG’s truck unit Traton SE also reported results that beat expectations.

Thanks to improvements in supply chains, higher production and price increases, Volvo lifted its operating margin to 14% in the quarter, up from 12% in the corresponding quarter last year.