Written by David Wren, SC Daily Gazette.
Volvo Cars has temporarily halted production at its Lowcountry plant because of a parts shortage, highlighting the growing supply chain issues automakers nationwide are experiencing in the wake of President Donald Trump’s on-again, off-again tariffs.
Volvo, which builds the all-electric EX90 sport-utility vehicle at its $1.2 billion plant in Ridgeville, did not immediately specify the parts involved or say how long the shutdown, announced Thursday, is expected to last.
While the vehicle is assembled in the U.S., its parts come from around the globe.
Between 20% and 25% of EX90 parts are made in America or Canada, while Mexico and China build 30% apiece, and the car’s transmission is produced in Sweden, according to details required by the American Automotive Labeling Act.
“The EX90 has been quite heavily impacted by tariffs,” Fredrik Hansson, the automaker’s chief financial officer, said during an April 29 earnings call. He said there have been indications that some “component tariffs may be softened, but it remains a significant factor.”
The carmaker is working with suppliers to resolve the problem and get the factory off Interstate 26 up and running again, according to news reports.
The shutdown comes on the heels of Volvo announcing layoffs affecting 5% of the plant’s workers, or roughly 125 people, and a global workforce reduction of 3,000 employees, most of them at the automaker’s Sweden headquarters.
The layoffs are part of nearly $2 billion in cost reductions Volvo is undertaking as tariffs have roiled global trade.
The EX90, with a list price of $79,995, is the only vehicle Volvo builds at its South Carolina factory. The plant also produces the battery powered Polestar 3 SUV for its sister brand.
The company has said it may add production of other vehicles at the Lowcountry site to offset tariffs on imported vehicles, which make up most of Volvo’s most popular sellers in the United States.
Trump has imposed 30% tariffs on all Chinese goods and 25% duties on foreign auto parts including those that don’t comply with the 2020 U.S.-Mexico-Canada free trade agreement.
This isn’t the first time Volvo has temporarily paused production at the South Carolina plant.
The site was shut down several times during the pandemic when supply chain snarls affected parts shipments for the S60 sedan that was being built there at the time. Volvo stopped U.S. production of the S60 last year.
The EX90 is the flagship model in Volvo’s pledge to build an all-electric lineup, but its sales have lagged the brand’s other gas-powered and hybrid models.
Through April, Volvo sold 4,051 EX90s worldwide compared with sales topping 80,293 for its most popular XC60 mid-sized SUV.
All told, EX90 sales have made up about 1.8 percent of Volvo’s 231,100 global sales through April.
This is a developing story and will be updated at scdailygazette.com
SC Daily Gazette is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. SC Daily Gazette maintains editorial independence. Contact Editor Seanna Adcox for questions: [email protected].