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2014-07-19

Volvo: Volvo Group ordered by US Court to pay penalties in engine emission case

The U.S. Court of Appeals for the District of Columbia Circuit has
ruled that the Volvo Group should pay penalties and interest of
approximately SEK 508 million following a dispute between the Volvo
Group and the U.S. Environmental Protection Agency (EPA) regarding
emission compliance of diesel engines. The Court of Appeals affirmed
a District Court's ruling that model year 2005 Volvo Penta engines
violated the provisions of a Consent Decree. This is expected to have
a negative impact on the Group's operating income of approximately
SEK 440 million in the third quarter of 2014 in the segment Group
functions and other.

The Volvo Group had previously accounted for approximately SEK 68
million as a provision and approximately SEK 422 million as a
contingent liability.

In 2012 the District Court issued a judgment ordering the Volvo Group
to pay penalties and interest for engines which Volvo claims were not
part of the decree. Volvo filed an appeal on several grounds. The
Court of Appeals' ruling was rendered on July 18, 2014. Volvo will
now review the ruling in detail, and consider whether to appeal or
not.

July 19, 2014

Journalists who would like further information, please contact Kina
Wileke +46 (0)31-66 12 32 or +46 (0)765-537229.

For more stories from the Volvo Group, please visit
http://www.volvogroup.com/globalnews.

The Volvo Group is one of the world's leading manufacturers of trucks,
buses, construction equipment and marine and industrial engines. The
Group also provides complete solutions for financing and service. The
Volvo Group, which employs about 110,000 people, has production
facilities in 18 countries and sells its products in more than 190
markets. In 2013 the Volvo Group's sales amounted to about SEK 270
billion. The Volvo Group is a publicly-held company headquartered in
Göteborg, Sweden. Volvo shares are listed on NasdaqOMX Stockholm. For
more information, please visit www.volvogroup.com or
www.volvogroup.mobi if you are using your mobile phone.

AB Volvo (publ) may be required to disclose the information provided
herein pursuant to the Securities Markets Act and/or the Financial
Instruments Trading Act. The information was submitted for
publication at 04.00 p.m July 19, 2014.

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http://news.cision.com/volvo/r/volvo-group-ordered-by-us-court-to-pay-pe...
http://mb.cision.com/Main/39/9618891/268452.pdf

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