Volkswagen reported a 74 per cent slide in first-quarter profits on Wednesday and PSA Peugeot Citroën reported a 25 per cent drop in its quarterly revenues as Europe’s two largest carmakers confirmed the extent of the global downturn in the sector.

The news came as Volvo AB, the truckmaker, said it was cutting more than 1,500 jobs at four divisions in Sweden due to sharply lower demand for large vehicles.