Michael Olsson was stabbed in the back and slashed in the face at a meeting with the workers last week in Balikpapan, East Kalimantan, police said.
Four men have been arrested in the attack. Three were among 31 workers who had recently been fired from the dealership, police said. A fourth was a member of right-wing youth group known for thuggery, they said.
Olsson, an executive with local Volvo dealer PT Eka Dharma, was trying to negotiate a settlement with the workers, who were demanding that eight managers also be fired and that the company give them 10 billion rupiah ($1.2 million U.S.) in compensation.
The Swedish newspaper Blekinge Laens Tidning said Olsson was hospitalized in Borneo, the island where East Kalimantan is located. It also said Olsson, a native of Karlskrona, 220 miles south of the capital, Stockholm, had not sought the help of Swedish Embassy.
Some tribal groups on Borneo island have carried out bloody attacks in recent years on settlers from other parts of Indonesia.
Labor strife is common in Indonesia and is partly to blame for a drop in foreign investment in recent years. Multinationals complain of having to endure violent strikes and villagers who attempt to extort money by blockading roads and attacking facilities.