Sweden's Volvo Cars switches gears in the U.S. as tariffs bite

Sweden-based automaker Volvo Cars plans to alteration tack successful the U.S. arsenic Washington's commercialized tariffs instrumentality their toll.

Volvo Cars, which is owned by China's Geely Holding, connected Thursday reported that second-quarter operating nett excluding items affecting comparability fell to 2.9 cardinal Swedish kronor ($297.83 million), down from 8 cardinal during the aforesaid clip past year.

Second-quarter gross dropped to 93.5 cardinal kronor, compared to 101.5 cardinal kronor implicit the aforesaid play successful 2024.

Volvo Cars, which is wide considered arsenic 1 of the astir exposed European carmakers to U.S. tariffs, said the effect reflects an ongoing challenging situation for the automotive industry. The institution said it was besides impacted by a previously announced one-off non-cash impairment complaint of 11.4 cardinal kronor.

The second-quarter net travel soon aft Volvo Cars launched plans to adhd its best-selling XC60 sports inferior conveyance to the accumulation enactment of its U.S. car works successful Ridgeville extracurricular Charleston successful South Carolina.

Production of the XC60, which has been the firm's best-selling exemplary globally for years, is scheduled to commencement astatine the mill successful precocious 2026.

At the aforesaid time, Volvo Cars has started pulling sedans and presumption wagons from its U.S. portfolio amid waning interest, Reuters reported Thursday. It comes arsenic U.S. tariffs of 27.5% connected European-made cars and 100% connected EVs imported from China person forced automakers to reappraisal their merchandise strategies.

Volvo Cars CEO Håkan Samuelsson said the institution would "definitely not" propulsion retired of the U.S. market, wherever it has been contiguous for 70 years.

"What we are doing is archetypal of all, we privation to capable our mill we person successful South Carolina. It should beryllium the strategical plus it was intended to be. So, we person to utilize it more," Samuelsson told CNBC's "Europe Early Edition" connected Thursday.

"Second, of course, present with the tariffs, it is precise earthy to bring successful a [car exemplary with] big-selling volume. We are bringing successful the XC60 SUV," helium added.