Volvo’s Most Popular Vehicle in America Will Soon Be Made Here, Too
CEO says the Swedish automaker will launch more hybrid models for U.S. drivers
By John Keilman
RIDGEVILLE, S.C.—Volvo Car’s only U.S. factory was supposed to bring 4,000 jobs to this area 30 miles northwest of Charleston. Today half that number run a single daily shift building expensive electric vehicles.
That is about to change thanks, in part, to the Trump administration’s tariffs. Starting next year the Swedish automaker will crank up production of its most popular SUV in America—the XC60—at this $1.3 billion plant set among the swamps and evergreen trees of the South Carolina low country.
For years that model has been shipped to the U.S. from Sweden, but the new 15% levy on foreign imports makes it worthwhile to move its manufacturing to the U.S., Chief Executive Håkan Samuelsson said in an interview with The Wall Street Journal.
Volvo’s XC60 SUV comes in two versions, a standard gasoline-electric hybrid and a more expensive plug-in hybrid. Combined, the two have notched more than 27,000 sales in the U.S. so far this year, a nearly 20% increase over 2024.
The company is adding more hybrid models to the Ridgeville factory because American car buyers proved slow to give up their gas-powered vehicles.
“We don’t want to force anybody into something which they don’t want, so we will have more conventional cars and hybrids,” Samuelsson said.
But he still believes the global future is electric.
Even as many American and European automakers and their suppliers are delaying, downsizing or canceling EV projects, Chinese automakers are gobbling up an ever-larger share of the global market.
Longer term, “the growth will be in electric vehicles,” Samuelsson said. “If you don’t realize that and just nostalgically stay in a shrinking segment, then you have a big risk of not surviving.”
To that end, Volvo is trying to improve a vehicle it already makes at the Ridgeville plant—an $81,000 electric SUV called the EX90. Only 2,500 have been sold in the U.S. so far this year, putting it in sixth place among the seven models Volvo sells here.
To better compete with rivals, the version coming out next year will have new features, including a safety alert for slippery roads and parallel parking assistance. The SUV’s charging time will also get shorter, Volvo said, gaining more than 150 miles of range in 10 minutes.
Volvo also plans to launch a new next-generation hybrid designed for American drivers. Executives gave few details about the upcoming vehicle, but said it would be in production at Ridgeville before 2030.
That is the same year Volvo has pledged to make at least 90% of its U.S. fleet “electrified,” a term that includes gas-electric hybrids as well as fully electric vehicles, and finally employ 4,000 workers on site as the factory adds new production lines.
Ridgeville was built to make 150,000 vehicles a year, but the consulting firm AutoForecast Solutions estimates it runs at about 20% capacity. Auto plants typically need to run at 80% of capacity to be profitable.
Volvo has never been a major player in the U.S., with its premium-priced cars claiming just 1% of the market. The brand has loyal fans and has long played up its safety bona fides—its television commercials once showed crash test dummies withstanding slow-motion collisions—but Jessica Caldwell, auto analyst for Edmunds, said that reputation means little to younger buyers.
Under the majority ownership of China’s Zhejiang Geely Holding Group, which bought Volvo from Ford in 2010, the company has tried to project an image Caldwell calls “the cool technology route.” U.S. sales have climbed over the past decade, and the U.S. now accounts for 20% of Volvo’s revenue.
Samuelsson said it is important for Volvo to have an industrial presence in the U.S. as a global manufacturer, and added that President Trump’s tariffs on foreign-made autos and parts also influenced the decision to revamp the Ridgeville plant.
Six of the seven models Volvo sells in the U.S. are imported from Europe, which makes them subject to a 15% tariff that adds thousands of dollars to each vehicle’s cost. Before Trump returned to office with an aggressive new trade policy, the cars faced a 2.5% tariff.
Producing vehicles in South Carolina allows Volvo to avoid the new higher levy. And under the preliminary terms of the U.S. trade deal with the European Union, the company can also export vehicles back to Europe tariff-free.
“That helps us to live with the 15%,” Samuelsson said.
Write to John Keilman at john.keilman@wsj.com