Car Industry

Volvo shifts US-bound XC60 production from China to dodge tariffs

Its European facilities will take over producing XC60s for us Yanks.

How many people even knew the XC60 was made in China in the first place? Thankfully, this won't affect anything beyond what coast it lands at.

Volvo

Volvo's on the verge of five straight years of sales records, and it's willing to do what it can to make that happen in the face of some stiff import tariffs.

Volvo will shift production of US-bound XC60 SUVs from China to Europe, Reuters reports, citing an interview with Volvo CEO Håkan Samuelsson. The reason for the shift is simple: Chinese-built vehicles face higher import tariffs than European-built ones, and Volvo doesn't want to risk harming its sales by raising prices or eating tariffs left and right.

It shouldn't really affect anything, which is nice. Volvo's plants in Europe currently build XC60s to the same specifications for European customers, while China takes care of cars for China and the US. Moving the US contingent to Europe can be balanced out by shifting a different market from its European facilities to China. That's kind of wild, that it'll be cheaper to move a car from China to Europe than from China to the US, all because of some tariffs.

Volvo just opened a plant in Ridgeville, South Carolina, but it's not built to assemble the XC60. Instead, it will handle the new S60 sedan for customers in both the US and abroad. It will eventually assemble the next-generation XC90 SUV, too, but that won't happen until 2020 or so.

That said, the XC60 and S60 are built on the same platform, so in the event things go really haywire and Volvo has no choice but to bring XC60 production to the US, it shouldn't be outside the realm of feasibility. And things do have the chance to go haywire, because the Trump administration is considering a 20 percent import tariff on European-built cars for "national security" purposes. Hopefully it won't come to that, because it could very well upend even domestic production of automobiles for both US sales and export.