Volvo Buses has announced that it is closing its plant in Wroclaw, Poland, in the first quarter of 2024. The site is home to the production of electric buses, among other vehicles.

Instead of building complete buses and coaches in Europe, Volvo will focus on chassis production in Europe, a business model that has proven successful in other markets.

“Our business in Europe has been loss-making for years,” says the President of Volvo Buses, Anna Westerberg. “With this business model that we already today apply successfully in many markets, we will improve profitability and secure our long-term competitiveness.”

According to a newly signed letter of intent, the production facility is to go to Vargas Holding, a company outside the industry. Some of Volvo’s employees will be offered employment with this successor company, it says. According to Volvo, the decision to stop the production of complete buses will affect about 1,600 jobs at Volvo Buses, of which about 1,500 are located in Wroclaw. Short-term, the move is expected to affect revenues in 2024 and 2025, says Volvo.

And a restructuring provision of about 1.3 billion Swedish Krona (about $124 million) will negatively impact operating income in the first quarter of 2023.

Volvo Buses introduced a new chassis for electric buses in 2021 under the name BZL Electric. It is designed for single- and double-decker buses with several options for bodybuilders and features a powertrain developed entirely by Volvo. The manufacturer cooperates with MCV in the UK and Irland, who uses the chassis as a base for two bus models.