December 28, 2005

Via Fax & U.S. Mail

Mr. Leif Johansson
President and CEO
Volvo Corporation
S-405 08 Goteborg
Goteborg, Sweden

Re:	Volvo Corporation
	Form 20-F for the fiscal year ended December 31, 2004
	File No. 0-12828

Dear Mr. Johansson:

      We have reviewed the above-referenced filing solely with
respect to the statement of cash flow presentation of cash
receipts
from the sale of inventory.  We believe that your presentation of
the
cash flow effects of certain customer-financing receivables as
investing cash flows on Volvo Corporation`s consolidated
statements
of cash flows may not be in compliance with the SFAS 95
requirement
to present all cash receipts from sales of goods or services as
operating cash flows.  We outline below our understanding of your
presentation and the reason why we believe your presentation may
be
in error.

	We note that Volvo Corporation sells the majority of its
commercial transport products through independent dealers.  In
addition, we note on page 30 that Volvo Corporation has
significant
sales through its own dealer network, and has substantial direct
sales to customers.  We note in Notes 13 and 16 that Volvo
Corporation has customer-financing receivables which are
classified
within financial assets on the consolidated balance sheet, as well
as
other receivables.  We understand that customer-financing
receivables
represent financing provided to dealers and customers for the
purchase of inventories.  We understand that certain of the
customer-
financing receivables are originated by Volvo Financial Services,
a
wholly-owned finance subsidiary.  It appears that the cash flow
effects of all customer-financing receivables are classified as
investing cash flows in the consolidated statement of cash flows.
If
true, this policy, when applied to customer-financing receivables
resulting from the sale of inventory, appears in the period of
sale
to have the effect of presenting in Volvo Corporation`s
consolidated
statements of cash flows an investing cash outflow and an
operating
cash inflow for the amount of the receivable even though there was
no
cash inflow or outflow to Volvo Corporation on a consolidated
basis.
In subsequent periods, this policy appears to reflect cash
receipts
from the sale of inventory as investing activities in Volvo
Corporation`s consolidated statements of cash flows. If our
understanding is correct, we believe such classifications to be in
error.


	Classification of the cash flow effects of customer-financing
receivables from the sale of inventory in investing activities in
Volvo Corporation`s consolidated statement of cash flow does not
appear to comply with the requirements of SFAS 95.  Paragraph 22a
of
SFAS 95 states that cash receipts from the sales of goods or
services
are operating cash flows.  Paragraph 22a clarifies that
classification as an operating activity is required regardless of
whether those cash flows stem from the collection of the
receivable
from the customer or the sale of the customer receivable to
others;
regardless of whether those receivables are on account or stem
from
the issuance of a note; and regardless of whether they are
collected
in the short-term or the long-term.  It is important to note that
SFAS 102 did not change this requirement.  SFAS 102 addressed in
part
whether loans made by financial and similar institutions were
sufficiently similar to product inventory of non-financial
institutions such that the cash flow effects of those loans should
be
classified in the statement of cash flows in the same way as the
cash
flow effects from the sale of inventory, as operating activities.
SFAS 102 did not alter the requirement in paragraph 22a to
classify
cash receipts from the sale of inventory as operating activities.
As
the SFAS 95 basis for conclusions indicates in paragraphs 93 to
96,
the FASB considered and rejected classifying any portion of the
cash
receipts from sale of inventory as investing activities.

	If you present in Volvo Corporation`s consolidated statement
of
cash flows inventory cash flows between the registrant and/or its
consolidated subsidiaries as an investing cash outflow and an
operating cash inflow in the period Volvo Corporation sells
inventory, and there is no cash inflow to Volvo Corporation on a
consolidated basis from the inventory sale, we believe such a
presentation represents an error in Volvo Corporation`s
consolidated
financial statements.  Similarly, if you present cash receipts
from
customer-financing receivables generated by the sale of inventory
as
investing activities in Volvo Corporation`s consolidated
statements
of cash flows; we believe such classifications represent errors.
Such errors, if material, may require restatement of Volvo
Corporation`s historical financial statements.

	Please tell us whether our understanding of your policy and
its
effects are correct.  If they are correct, please tell us in your
response how you plan to address the matters raised above.
Please
also confirm our understanding, if true, that "other" receivables
do
not relate to the sale of inventory by Volvo Corporation.
Finally,
please tell us whether you enter into sales-type leases with
dealers
and, if so, how you present such cash flows on the consolidated
statements of cash flows and why.


* * * * *




	Please tell us within 15 business days how you plan to
address
the matters raised above.  If you have any questions regarding
this
letter, please do not hesitate to contact Beverly Singleton, Staff
Accountant, at (202) 551-3328 or the undersigned at (202) 551-
3211.

Sincerely,



David R. Humphrey
Branch Chief

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Mr. Leif Johansson
Volvo Corporation
December 28, 2005
Page 3