Both Volvo and International Truck have initiated layoffs this year due to sluggish orders and high production capacity in preparation for a potential 2026 truck pre-buy ahead of the phase 3 GHG Emission Regulations scheduled for implementation in 2027.
Volvo Trucks North America plans to lay off up to another 350 workers from a Virginia plant as part of job cuts affecting up to 980 employees across the country since the beginning of the year.
Employees at the New River Valley plant in Dublin, Virginia, were notified of the workforce reduction this month, and their last day at the facility will be June 27, Volvo spokesperson Janie Coley said.
“Heavy-duty truck orders continue to be negatively affected by market uncertainty about freight rates and demand, possible regulatory changes, and the impact of tariffs,” Coley said in a statement to The Patriot News.
“In the case of [New River Valley], this is unfortunately a second wave of layoffs. You might recall that we announced a layoff of 250-350 in February; this ended up being about 180 people, due to attrition. So, we currently expect that the total impact at [New River Valley] will unfortunately be about 430 to 530 people.”
Volvo recently announced it was laying off 250 to 350 people at its Mack Trucks Lehigh Valley Operations in Macungie, Pennsylvania, and 50 to 100 people at its Volvo Group Powertrain Operations plant in Hagerstown, Maryland.
Traton SE has eliminated the second shift at its International brand’s Mexican plant, a move that means 900 people have lost their jobs, as executives look to contain costs after a first quarter during which North American orders fell by more than a third.
CEO Christian Levin and CFO Michael Jackstein told analysts April 28 that they also have instituted a hiring freeze at International, where sales fell 11% from the first three months of 2024 as customers have pulled back on spending in the face of tariff-led economic uncertainty. The division’s incoming orders fell to less than 9,700 in the first quarter from nearly 13,600 early last year. In the United States and Canada, orders fell to about 8,000 from more than 12,200 a year earlier.
On a conference call discussing Traton’s Q1 results and outlook, Levin and Jackstein said they are looking at other layoffs to cut costs in the face of what Levin called “a wet blanket over the entire market right now.” In addition to macroeconomic worries, he said, uncertainty about the Environmental Protection Agency’s 2027 emissions regulation changes has forced Traton to assume there will be “no sizable” prebuy of trucks in 2025. That means Class 8 volumes in North America are likely to be down nearly 10% to roughly 280,000 vehicles.
PSR Analysis. Primarily due to the uncertainty of future freight demand driven by implementation of international tariffs, many of the truck companies are holding off on replacing or expanding their fleets until there is more clarity in the market.
While VTNA produces all of their trucks for the North American market in the United States, International truck produces their North American trucks in both the United States and Mexico. Since all of the International truck models produced in Mexico are also produced in the United States, International can easily transfer production between countries.
The longer the trade negotiations continue, the more pressure this will place on commercial truck demand. We will likely see more layoffs from the other OEMs in the coming weeks or months as the OEMs will need to reduce production capacity. At this point, it looks like any 2026 truck pre-buy is at risk or at least seriously tempered down.
With regards to tariffs, the United States and the United Kingdom have reached a tariff deal and there are a number of deals with other countries that reportedly are in the works, according to the White House. The United States and China have recently reduced tariffs and postponed the deadline for an additional 90 days as negotiations continue. PSR
Chris Fisher is Senior Commercial Vehicle Analyst at Power Systems Research
