Union negotiations completed - 192 to leave Volvo Aero

In May, Volvo Aero announced a preliminary layoff of 250 employees in
Trollhattan, Sweden. The mandatory negotiations with the employees'
union representatives have now been concluded. As a consequence, 134
persons will be issued notices of termination of employment and 58 will
be offered early retirement. A total of 241 jobs are being eliminated in
Trollhattan - 148 positions represented by the Metal Workers' Union and
93 staff and administration positions.

In addition to those being released and offered early retirement, the
number of employees is expected to be reduced during the year by at
least another 49 persons through old-age retirement and resignations.
The background to the terminations is well known: the crisis within the
international aviation industry is impacting all companies and Volvo
Aero is no exception. All production locations (Trollhattan, Bromma and
Malmo in Sweden, Kongsberg in Norway and Boca Raton, Florida, in the US)
have already reduced the number of personnel.

"I heavily regret that some of our employees must now leave the company.
I hope they understand that the terminations are due to the aviation
industry being in its deepest crisis in history. When we see that a
recovery will be delayed for several years, we have no other choice than
to reduce the number of employees," says Fred Bodin, President of Volvo
Aero.

In 2001, Volvo Aero in Trollhattan served notice of termination of
employment to 310 employees. On this occasion, this resulted in a
personnel reduction of 303 employees, of which 168 were released and 68
were offered early retirement.
Currently, Volvo Aero in Trollhattan has about 2,260 employees. In
total, the Volvo Aero group of companies has approximately 3,500
employees.

October 20, 2003


For further information, please contact 
Fredrik Fryklund, Head of Corporate Communications, +46 520 94 401.