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Live news updates from October 27: Musk vows not to turn Twitter into a ‘hellscape’, Putin denies plans to use nuclear weapons

Sporadic lockdowns in China caused Volvo Cars to downgrade its deliveries targets for the year, while rising costs and the need to buy semiconductors on the open market dented profits during the third quarter.

The Swedish carmaker, backed by China’s Geely, initially expected wholesale deliveries to remain flat this year compared with 2021.

But on Thursday the company said it now expects “slightly lower wholesale volumes than 2021, assuming no further major supply chain disturbances”.

Chinese closures were the “biggest issue by far” for the business, chief executive Jim Rowan said, with some suppliers closed for 70 days.

The “sporadic” nature of the closures, which hit Volvo’s suppliers and impacted its plants globally, make it “so difficult for us to predict the end of that”, he said.

The company has been trying to relocate supplies to Europe and the US to cut its reliance on Chinese parts. The group is building a factory in Slovakia to increase European production, and is taking key parts of the electric drive system in-house.

It is also expecting to announce deals in the coming months to increase its supply of lithium and other battery materials, Rowan added.

In the third quarter, car sales fell 8 per cent to 138,000 vehicles, but revenues climbed a third to SKr79.3bn (£6.3bn) as its previously announced price increase fed through.

Net income fell 70 per cent to SKr700mn. Volvo’s profit margin dropped from 7.1 per cent to 4.4 per cent, or from 5.5 per cent to 2.6 per cent once its stake in lossmaking Polestar was included.

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