VOLVO AERO AND SAs SIGN CONTRACT WORTH 1.8 BILLION

Volvo Aero and Scandinavian Airlines have signed a contract whereby
Volvo Aero is becoming the principal supplier of engine overhaul
services for Scandinavian Airlines' and Spanair's MD80 fleet of
aircraft. The contract, which covers the period up to and including
2006, is expected to be worth
SEK 1.8 billion to Volvo Aero.

Under terms of the contract, which was signed on Thursday, Volvo Aero
will have primary responsibility for overhaul of the engines in
Scandinavian Airlines' and Spanair's fleet of MD80 aircraft. The company
estimates that several hundred IT8D engines will be taken in for
maintenance during the contract period.

"We are very pleased that the contract has been signed. This is
extremely important for our business," says Goran Norden, Marketing
Manager of Volvo Aero's Engine Services business area.

The new contract is within the framework of Volvo Aero's planned annual
volume of business and accordingly will not result in any new hiring.

April 4, 2003

For additional information, please contact Goran Norden +46 70 662 74 80