Volvo cheers quadrupled profits, new chairman

Sweden's Volvo said Wednesday it had lured Martin Lundstedt from rival truck maker Scania as it revealed first quarter profits had quadrupled to 4.25 billion krona (457 million euros, $491 million).

Volvo, the world's second-largest truck manufacturer, said in a statement that current Scania boss Lundstedt would join the company as chief executive in October, after spending his entire career with the Volkswagen-owned rival.

Ludstedt replaces outgoing company president Olof Persson.

The announcement of increased profit on 14.8 percent higher first quarter sales came two days earlier than planned, and surpassed forecasts by analysts polled by Bloomberg.

Volvo also said operating profit for the period had risen from 3.9 percent in 2014 to 6.1 percent this year.

Those improved results follow moves by the company to surmount serious setbacks encountered in 2012 and 2013.

"After three years of focus on product renewal, internal efficiency and restructuring, the Volvo Group is gradually entering a new phase with an intensified focus on growth and increased profitability," Henric Svanberg, chairman of Volvo's board, said in the statement.

As part of that process, Volvo sold off nearly 20 billion krona of non-core investments, and in January spent nearly 750 million euros to acquire the truck unit of Dongfeng, which controls between 15 percent and 18 percent of China's market.

Swedish press reports have suggested Persson has come under pressure in recent weeks amid internal dissent and a desire by some Volvo shareholders to speed the pace of restructuring.

Lundstedt's relationship with Scania's Volkswagen bosses was unclear after he opposed the German car marker’s March, 2014 decision to increase its  stake in Scania from 63 percent to full ownership.

Though Lundstedt argued the price offered for the outstanding share of Scania was too low, Volkswagen eventually obtained the desired 100 percent.

Lundstedt joined Scania as an intern in 1992, and eventually rose through the group's management ranks to take the top job in 2012.

Prices of Volvo shares shot up by 11.9 percent Wednesday morning on Stockholm's stock exchange posting an average advance of 0.56 percent.

Volvo currently has 104,000 employees in the world, after having shed 3,000 job in the last year.