This story was originally published on Automotive Dive. To receive daily news and insights, subscribe to our free daily Automotive Dive newsletter. Dive Brief: Volvo Cars is boosting its investment in South Carolina to build its XC60 mid-size SUV for the U.S. market starting in late 2026, the automaker announced in a press release Sept. 23. Currently, the XC60 is primarily produced in Sweden. Following U.S. production of the vehicle, the plant will also build a new, next-generation hybrid model for the ...

Group 1 - Geely-owned Volvo Cars is continuing its investment in the Ridgeville manufacturing facility in South Carolina to maximize output in the coming years [1][2] - The company plans to introduce a new hybrid model for the US market at the Ridgeville plant before 2030, having already invested $1.3 billion over the past decade [2][3] - The Ridgeville plant currently has an installed capacity of 150,000 vehicles annually, producing the all-electric EX90 SUV and the Polestar 3, with plans to add the XC60 mid-size SUV to production by late 2026 [3][4] Group 2 - The XC60 has seen strong market uptake in the US, with sales exceeding 27,000 units in the first eight months of this year, a nearly 20% increase from the same period in 2024 [4][5] - Volvo Cars has experienced a downturn in global car sales for August 2025, with a 9% year-over-year decrease, selling 48,029 vehicles [5][6] - There has been a notable 28% drop in demand for fully electric vehicles, which now account for 20% of total sales volume [6]

But then of course we we lost profitability with a lot of extra cost coming in tariffs not the least tariffs impacting your decision here at this plant. You're going to be adding XC60 production. Most of the XC60 sold in this country already imported from Sweden but you want to build them here.This is a direct reflection of the fact that the trade environment has changed. Correct. Yeah, I I would say so.The word is regionalizing. I mean the area of globalization, global cars you should ship back and forth i ...

Volvo expanding production operations in the United States and Philo joins us now with the company's CEO. Good morning, Phil. >> Good morning, Andrew.Hoken Samuelson back in the saddle again and we're talking again. Uh, now that you've returned as CEO of this company, um, we're going to talk about what your future plans are here in a bit. How did Volvo lose its way over the last couple of years.Yes, sales are up 1%, but what's been limiting your your potential. >> No, I wouldn't say we lose our way. maybe a ...

Core Insights - Volvo is expanding its production operations in the United States, particularly focusing on the XC60 model, which is currently imported from Sweden [3][10] - The company acknowledges a need to adapt to a changing trade environment, emphasizing regional production over globalization [3][4] - There is a recognition that electrification has not progressed as quickly as anticipated, leading to underutilization of production capacity [5][6] Group 1: Production Expansion - Volvo plans to start building the XC60 in the U.S. by late 2024 or 2025, with another model expected by 2030 [4][10] - The company aims to be a serious domestic player in the American market, necessitating a stronger industrial presence [4][10] Group 2: Market Dynamics - The automotive industry is experiencing a shift with new Chinese players entering the market, which may lead to consolidation among existing brands [7][8] - It is projected that within five years, a third of the automotive industry could be Chinese, indicating significant market changes [8] Group 3: Challenges and Opportunities - Volvo sees electrification as an opportunity but acknowledges the need for pragmatic solutions for customers who cannot charge their vehicles [5][6] - The company believes that as charging infrastructure improves and electric vehicle prices decrease, the adoption of electric vehicles will increase [6]

Group 1: Trade Agreements and Tariffs - The U.S. has signed trade agreements with multiple countries, including Japan, the EU, and South Korea, ahead of the August 1 deadline for reciprocal tariffs, with varying tariff rates [2][3][5][7] - The U.S. will impose a 25% tariff on all imported cars and key components starting April 3, 2025, raising passenger car tariffs to 27.5% and truck tariffs to 50% [2] - The EU and U.S. reached a framework agreement on July 27, reducing tariffs on most EU goods, including cars, to 15%, while the EU commits to invest $600 billion in the U.S. [3] Group 2: Impact on Automotive Industry - The reduction of tariffs from 27.5% to 15% for EU automakers is welcomed by companies like Volvo and Volkswagen, providing planning certainty for the European automotive industry [3][4] - The German automotive industry is expected to incur significant losses due to the new 15% tariff, which is six times higher than the previous 2.5% [4] - Japan's agreement to a 15% tariff on cars and components, along with a $550 billion investment in the U.S., reflects a significant concession from the U.S. side [5][6] Group 3: Specific Country Agreements - South Korea's agreement mirrors Japan's, with a 15% tariff on cars and a commitment to invest $350 billion in the U.S., while maintaining certain market protections [7][9] - The U.K. has negotiated a reduction in tariffs on cars exported to the U.S. from 27.5% to 10%, with an annual limit of 100,000 vehicles, which is expected to significantly lower export costs [10][11] - The U.K. automotive industry faces challenges despite the tariff reduction, as the quota limits and existing tariffs still constrain export growth [11]

Core Viewpoint - Volvo reported a significant loss in Q2 due to U.S. tariffs, marking its first quarterly loss since going public in 2021, with a loss of 10 billion Swedish Krona (approximately 7.4 billion RMB) instead of the expected profit of 2.3 billion Swedish Krona (approximately 1.69 billion RMB) [1][2] Financial Performance - The direct cause of the loss was a one-time charge of 11.4 billion Swedish Krona (approximately 8.44 billion RMB) due to a 25% tariff on foreign-made cars, which prevented the profitable ES90 model from entering the U.S. market [2] - Excluding this one-time charge, Volvo's operating profit for Q2 was 2.9 billion Swedish Krona (approximately 2.15 billion RMB), which, while significantly lower than the 8 billion Krona (approximately 5.92 billion RMB) from the same period in 2024, still slightly exceeded market expectations [2] Workforce and Cost-Cutting Measures - In response to the deteriorating business environment, Volvo announced a global layoff of 3,000 employees, representing about 15% of its white-collar workforce, with a one-time restructuring cost of 1.5 billion Swedish Krona (approximately 1.1 billion RMB) [4][5] - The layoffs will primarily affect administrative, research, and strategic departments, with 283 positions cut in China, accounting for 3.5% of its workforce in the region [4][5] Strategic Adjustments - To mitigate the impact of tariffs, Volvo plans to start producing its best-selling XC60 SUV at its South Carolina plant by the end of 2026 to avoid high import tariffs [2] - The company has initiated a cost-cutting plan totaling 18 billion Swedish Krona (approximately 13.32 billion RMB), set to be completed by 2026, and has canceled financial guidance for 2025 and 2026 [5] Market Challenges - Volvo's sales in China fell by 8% in 2024, with a 12% decline in Q1 2025, indicating significant challenges in its electric vehicle transition [6] - The company has faced criticism for its slow pace in electric vehicle development, with recent models like the EM90 and EX30 receiving poor market reception [7][8] Industry Context - Volvo's struggles reflect broader challenges in the European and Japanese automotive sectors, with analysts predicting a tough earnings season due to the ripple effects of U.S. tariffs [3] - Other major automakers, including Nissan, Volkswagen, and Ford, have also announced layoffs and cost-cutting measures, indicating a trend across the industry [5]

Financial Performance - Volvo reported a revenue of 93.5 billion Swedish Krona for Q2 2025, a decline from 101.5 billion Swedish Krona in Q2 2024 [1] - The operating profit decreased to 2.9 billion Swedish Krona, down from 8.2 billion Swedish Krona in the same period last year [1] - The company faced a net loss of 7.51 billion Swedish Krona, contrasting with the previous year's performance [1] Sales Data - Global retail sales fell to 181,600 units in Q2 2025, a decrease from 205,400 units in Q2 2024, representing a decline in demand [1] - Sales of pure electric vehicles dropped by 26% year-on-year, indicating a weakening market for electric models [1] - In Q2 2024, the company experienced a 15% increase in overall sales, with a notable 43% growth in new energy vehicles [1] Challenges and Adjustments - The primary reason for the financial loss was attributed to a financial impairment adjustment related to the EX90 and ES90 platforms, leading to an asset impairment of 11.4 billion Swedish Krona [1] - The company incurred an additional 1.4 billion Swedish Krona in restructuring costs, compounding financial pressures [1] - External factors such as macroeconomic uncertainty, tariff policy fluctuations, and intensified market competition continue to challenge production and profitability [1] Strategic Responses - Volvo is reducing its product lineup by halting sales of certain models in the U.S. and discontinuing models like the S60 and S90 [3] - The company has made asset adjustments, including a significant impairment provision for the EX90 model [3] - Plans are underway to launch a new mid-size SUV, the XC60, by the end of 2026 to seek growth opportunities in the evolving market [3] - In the Chinese market, the CEO emphasized the need to focus on local demand rather than simply replicating European product strategies [3]

Financial Performance - In Q2 2025, Volvo reported a revenue of 93.5 billion SEK and an operating profit of 2.9 billion SEK, but faced a net loss of 7.51 billion SEK [1] - In comparison, Q2 2024 saw a revenue of 101.5 billion SEK and an operating profit of 8.2 billion SEK, with net profit figures not disclosed [1] Sales Data - Global retail sales in Q2 2024 reached 205,400 units, marking a 15% year-on-year increase, with electric vehicle sales up by 43% [3] - However, in Q2 2025, global sales declined to 181,600 units, with pure electric vehicle sales dropping by 26% year-on-year [3] Loss Analysis - The significant loss in Q2 2025 was primarily attributed to financial impairment adjustments related to the EX90 and ES90 platforms, resulting in an asset impairment of 11.4 billion SEK and restructuring costs of 1.4 billion SEK [3] - The company cited macroeconomic uncertainty, tariff policies, and increasing market competition as ongoing pressures on production and profitability [3] Strategic Responses - Volvo has implemented several measures to address current challenges, including reducing product offerings, pausing sales of certain models in the U.S., and discontinuing models like the S60 and S90 [3] - The company has also adjusted its asset valuations, particularly for the EX90 model, with a provision for impairment of 11.4 billion SEK [3] - Future product planning includes the introduction of a mid-size SUV, the XC60, expected to begin production by the end of 2026 [3] Market Focus - The CEO of Volvo emphasized the importance of localization strategies in the Chinese market, advocating for a deeper understanding of local consumer needs rather than simply replicating European products [4]

Group 1 - Li Auto announced the completion of its "Nine Vertical and Nine Horizontal" high-speed supercharging network core routes after 2 years and 3 months of development [1] - Volvo Cars will begin production of its best-selling mid-size SUV, the XC60, at its South Carolina plant by the end of 2026, with a projected sales increase of nearly 23% in the first half of 2025 [3] - Smart China officially announced its first plug-in hybrid model, the EQ5 EHD, featuring a wheelbase of 2900mm, a pure electric range exceeding 250km, and a combined range of over 1600km [3]