Volvo is now moving larger parts of its production to the US due to fears of the country's new tariffs. But it will take several years for the brand to be in place, the assessment is.
The car brand Volvo is moving a larger part of its car production to the United States. The reason is the new American tariffs on imported cars.
This could mean that production is moved away from Sweden – and partly China – to avoid the tariffs, which President Trump has set at 25 percent.
Volvo currently exports a significant number of cars from its factory in Gothenburg to the US market.
This amounts to approximately 100,000 cars annually, which corresponds to almost half of the factory's total production. The primary models shipped to the US from Gothenburg are the Volvo XC60 and XC90.
In response to the new tariffs, Volvo is looking at how to shift more of its production to the U.S. The brand already has one factory in South Carolina.
Moving from Sweden to the US to avoid customs duties on cars
But now the reinstated director Håkan Samuelsson says that it is necessary to move even further to the USA.
"We will have to increase the number of cars we build in the United States and certainly move another model to that factory," he told Bloomberg .
Volvo is currently analyzing which car model to potentially produce in the United States in addition to the models already planned at the South Carolina plant.
There is much evidence that it could be either the Volvo XC60 or XC90, as they are among the brand's best-selling models globally and specifically in the United States.
At the same time, Volvo plans to produce its upcoming electric car, the EX60, in Gothenburg, with production starting next year.
Volvo Cars is a major employer in Sweden with around 20,000 employees. The possible relocation of production away from Sweden due to tariffs creates uncertainty about future Swedish jobs in the automotive industry, industry insiders point out.
The process of moving the production of a car model and establishing it at a new factory typically takes around two years to complete.
This underlines the long-term considerations Volvo faces in connection with international trade conditions and customs policy.
