Volvo Halts US Sedan Sales, Reports $1.8B Tariff Losses

Volvo Cars has significantly scaled back its U.S. model lineup due to the impact of President Donald Trump's tariffs, which impose steep import duties on European and Chinese-made vehicles, making many models unprofitable to sell in the U.S. As a result, Volvo will focus on selling mostly SUVs in the U.S., discontinuing sedans like the S60, S90, and the new ES90 which cannot compete profitably under current tariff conditions. The Swedish automaker has taken a substantial impairment charge exceeding $1.8 billion to write down the value of its EX90 electric SUV and ES90 sedan, reflecting lost sales potential and delays worsened by trade barriers. To mitigate tariffs, Volvo plans to expand production of its best-selling SUVs, the XC60 and XC90, at its South Carolina plant by 2027-2028, leveraging local manufacturing to avoid import duties. Meanwhile, the South Carolina factory operates at low capacity, highlighting the challenge and opportunity for Volvo to pivot production to models favored in the U.S. market. The tariffs have also severely impacted global auto exports from other countries, such as South Africa, threatening jobs and industrial hubs dependent on vehicle exports to the U.S.