Scania Moves Production to Sodertalje

All affected employees will be offered continued employment atScania. Meanwhile the company is working to find replacementindustries for the affected communities.

"We are acting now in order to maintain or long termcompetitiveness and to retain jobs in Sweden," says Per Hallberg,Scania's Head of Production and Procurement.

Moving axle and gearbox production to Sodertalje means that Scaniawill have production and product development in close proximity toeach other, which will lead to both quality and cost benefits.

"Components and parts that are not strategic may be manufacturedby others in the future. Here we have great hopes of findinginterested parties willing to take over part of our operations in bothFalun and Sibbhult," Mr Hallberg says.

Moving parts management to Belgium will yield a number ofbenefits. Proximity to most of Scania's customers and suppliers willmean higher availability and lower costs. In Sodertalje, Scania willretain a regional distribution centre for the Nordic markets.

Moving these operations will be completed within a three-yearperiod, and the annual cost saving is estimated at about SEK 300 m.

Press conferences will be held today at 16;00 CET at Scania'splants in Falun and Sibbhult.

Scania is one of the world's leading manufacturers of trucks andbuses for heavy transport applications, and of industrial and marineengines. A growing proportion of the company's operations is comprisedof products and services in the financial and service sectors,assuring Scania customers of cost-effective transport solutions andmaximum uptime. Employing 30,000 people, Scania operates in about 100countries. Research and development activities are concentrated inSweden, while production plants are located in Europe and SouthAmerica, with facilities for the global exchange of both componentsand finished vehicles. In 2005, revenue totalled SEK 63.3 billion andnet income amounted to SEK 4.7 billion.

Scania press releases are available on the Internet,www.scania.com

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