Volvo Shifts XC60 Production to U.S. Amid Tariff Pressures

Volvo Cars plans to start producing the XC60 SUV in South Carolina by late 2026 to mitigate impacts from U.S. auto tariffs. This move reflects the rising demand for the model in the U.S., while the company navigates financial challenges related to tariffs and production delays for other models.

Volvo Cars has announced its plans to commence production of the XC60 SUV at its South Carolina plant by late 2026. This strategic move aims to alleviate the impact of U.S. auto tariffs, especially as the company imports most of its hybrid and electric models from Europe.

The decision comes as a response to increased XC60 sales in the United States, which surged by nearly 23% in the first half of 2025. The company, owned by China's Geely Holding, faces additional financial hurdles with an 11.4 billion crown impairment charge due to tariffs and delays affecting its ES90 and EX90 models.

Volvo's shift towards boosting U.S. production aligns with CEO Hakan Samuelsson's earlier statements about regionalizing operations. Although this will pressure profit margins, the company emphasizes its commitment to expanding its American market presence.

(With inputs from agencies.)