The experts on Volvo's message: "It's about common sense"

Volvo chooses to cut the dividend at the Annual General Meeting in June. Savings economists Frida Bratt and Joakim Bornold think that was an expected message.

- I think it's a sensible decision from both a larger perspective but also from Volvo's own perspective. In this situation, it is impossible to distribute money with one hand and receive crisis support with the other. I am also sure that the Swedish owners understand the decision and think it is okay. However, I am not so sure that the foreigners are, says Joakim Bornold, economist at Söderberg and partners.

Frida Bratt, economist at Nordnet thinks in similar paths.

- It's about common sense not to distribute money and receive support from the state at the same time, even though the dividend relates to last year's profits.

Will the message arrive late?

- It has circulated rumors and has become speculation what the message really should be. Many people have probably been waiting for a message, but I think many shareholders have an understanding of this.

If Volvo had gone the other way and still distributed the money, the experts believe they could have damaged the company.

- Even if you have the opportunity to distribute, you have to count on the PR-related loss that it would have been in this situation if you distributed the money. It had become an impossible discussion, says Bratt.

The fact that the corona pandemic has turned upside down on a lot of the world has also meant that historical decisions made by Volvo today, says Bornold.

- What is quite unique is that you choose not to distribute money even though you have it. The occasions you did not give out earlier, you have not had money. But now there is a lot of money and it is a very special situation. Choosing not to distribute when the checkout is packed, it has never happened before and will probably never happen again, says Joakim Bornold.