STOCKHOLM – Swedish heavy truck maker Scania will stop production in Europe for a month because of a slowdown in demand, a spokesman for the company said on Wednesday.
"We will stop production for a month. We will extend the vacation period from December 22 until January 16," spokesman Hans-Aake Danielsson told AFP.
"We can't produce the same as we did when demand was higher. We have to adjust our production," he said.
Danielsson said the company would also halt its bus production for three weeks from December 22.
Scania posted a rise in third quarter profits, but like its Swedish rival Volvo Trucks it has suffered from a sharp drop in orders.
For the July to September period, Scania posted a net profit of 1.81 billion kronor 182 million euros, 227 million dollars, up 3.6 percent from a year earlier.
But orders for heavy trucks plunged by 41 percent. In western Europe, Scania's biggest market, they dived by 69 percent, while the potential growth markets of central and eastern Europe fell by 45 percent.
"Due to uncertainty about future business conditions as well as liquidity shortages, customers in Europe have become increasingly cautious about placing new orders," chief executive Leif Oestling said when he presented the third quarter earnings on October 24.
The Scania share price closed down by one percent at 61.75 kronor on the Stockholm stock exchange, in an overall market that closed up by 1.10 percent.
