This planned restructuring "means that production at the Volvo Buses plant in Saffle, Sweden, will be terminated at end June 2013, provided that the necessary union negotiations have been completed by then," the company said in a statement.

The Swedish plant, which now employs 330 workers and 60 consultants, would become a technical center with about 50 people on the payroll.

"The demand for new buses in Europe has dropped steadily over the past few years, paralleled by considerable pressure on prices, particularly in the Nordic markets," said Hakan Karlsson, president of Volvo Bus Corporation.