Provision for expected credit losses for Volvo CE in China

Volvo Construction Equipment’s operating income for the fourth quarter of 2014
will be negatively impacted by approximately SEK 650 M from a provision for
expected credit losses in China. The provision will have limited impact on the
Volvo Group’s cash flow and net financial debt in the fourth quarter 2014.
Following an extended period of declining demand, low machine utilization and
lower raw materials prices, profitability for customers and dealers primarily in
the Chinese mining industry has declined and their financial position has
weakened. The risk for future credit losses has therefore increased and as a
consequence Volvo Construction Equipment (Volvo CE) is provisioning SEK 650 M in
the fourth quarter of 2014. The current provision level for expected credit
losses is based on the Group’s prevailing best estimate.

November 21, 2014

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

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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 Nasdaq 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 08.00 a.m November 21,
2014.