Press releases 2002

Volvo Bus Corporation's Joint Venture for city buses in China - Shanghai Sunwin Bus Corporation - marked a major breakthrough today with the signing an order for 500 Volvo city buses with one of the leading Shanghai Operators, the Shanghai Ba-shi (Group) Industrial Co.Ltd. The buses will be delivered over the next 12 months. The order is valued at approximately SEK 500 M. The agreement includes an option an additional 500 Volvo buses, with deliveries scheduled during the second half of 2003 and 2004.

Volvo Penta has secured an order from Saudi Arabia for a total of 900 diesel engines. The total value of the order is approximately MSEK 200.

Deliveries from Volvo's truck operations, which includes Volvo Trucks, Mack Trucks Inc., and Renault Trucks increased by 13% for the month of June, compared with the same month last year. On a year-to-date basis, deliveries amounted to 77,103 trucks compared with 82,084 trucks for the same period last year, a decrease of 6 %. In Europe, deliveries declined by 8 % to 47,748, and 18,034 trucks were delivered in North America, which is 9 % less compared with the same period last year.

The first quarter was characterized by model changes within Volvo Trucks. This was completed during the second quarter and the new models are now in full production. Volvo CE also went through an extensive changeover although on a smaller scale, and production is now running at a high level to respond to the strong customer demand. Business conditions continue to develop in different directions for the Group's business areas, with the exception of the markets in Asia and Eastern Europe where the entire Group has a very strong development. Cash flow improved mainly due to favorable development of working capital and lower investments in fixed assets. Turn-around efforts in Buses resulted in positive operating income, and two large and profitable orders were secured for the Mexico plant, says Leif Johansson, CEO.

Volvo Buses de Mexico has received an order for 340 first-class and luxury coaches in Mexico from one of the leading operators of intercity traffic- the ADO Group. The new deal is a confirmation of Volvo as one of the selected suppliers to ADO as they again chose Volvo for their premium services. The value of the order amounts to approximately USD 70 millions and the deliveries will take place during a fourteen-months period, beginning in October 2002. The majority of coaches are Volvo 9700, both two and three axles, based on the TX platform, and some Volvo three-axle Volvo 7550s.

Volvo Buses de Mexico has received an order for 340 first-class and luxury coaches in Mexico from one of the leading operators of intercity traffic- the ADO Group. The new deal is a confirmation of Volvo as one of the selected suppliers to ADO as they again chose Volvo for their premium services. The value of the order amounts to approximately USD 70 millions and the deliveries will take place during a fourteen-months period, beginning in October 2002. The majority of coaches are Volvo 9700, both two and three axles, based on the TX platform, and some Volvo three-axle Volvo 7550s.

AB Volvo hereby invites the representatives of the media to a press conference on Tuesday, July 23, in conjunction with the release of the Volvo Group's report on the first six months 2002.

Volvo Construction Equipment (Volvo CE) has sold its sales company in the Czech Republic, Volvo Stavebni stroje CR s.r.o, to Bilia Baumaschinen GmbH, a wholly owned subsidiary of Bilia AB in Sweden.

Volvo Trucks established operations in Asia many years ago, and is currently in the process of reinforcing its presence in the region.In conjunction with a major event planned for customers and the media on Thursday in Bangkok, the company re-emphasised its long-term undertakings.We have a firm belief in continued strong expansion in Asia, and we are making the necessary investments to grow together with our customers, says Claes Svedberg, head of the International Division at Volvo Trucks.

Volvo Trucks and Volvo Construction Equipment have signed a letter of intent with Republic of Serbia Republican Roads Directorate covering delivery of slightly more than 100 trucks and construction equipment. Total value of the transaction is SEK 120 M.