In the long-term, demand for freight capacity, and thus many of the Group’s products, is closely linked to the GDP trend. The extent of investment in infrastructure, which drives demand for building and construction equipment, is also, closely linked to the GDP trend. In the short-term, demand is affected by a number of factors including fuel prices, the implementation of new emission regulations, interest rates, etc.
From a historical perspective, despite the recovery in the truck and construction equipment markets in 2010, demand was below the long-term trend in Europe, North America and Japan. The Volvo Group sees no development that would imply that the connection between GDP trends and the sales of vehicles and machines would have changed and, accordingly, the view is that in time, demand will recover and return to levels corresponding with the long-term trend.