Stockholm - Heavy-vehicle maker Volvo on Wednesday said it planned to give notice to some 1,500 employees in Sweden citing "the sharp decline on world markets."

Most of the cuts, about 1,300 employees, affect Volvo Trucks and Volvo's Powertrain division, which makes engines and gearboxes used in its heavy vehicles as well as construction machinery.

They are part of the Volvo Group that does not include Volvo Cars, the Swedish car maker owned by US giant Ford.

Other divisions affected included Volvo Construction Equipment and Volvo Penta.

Volvo said it was soon due to begin talks with unions.

Meanwhile, talks were continuing at local plants over pay cuts of up to 20 per cent by reducing working hours - in line with an agreement signed last month between the blue collar union IF Metall and the Association of Swedish Engineering Industries.

On Friday, the heavy vehicle-maker was due to present its first quarter report. (dpa)