Much was about the storm clouds gathering from the west when truck manufacturer AB Volvo called for an annual general meeting in Gothenburg on Wednesday - the same day as Donald Trump referred to as "Liberation Day".
It is later on Wednesday that the American president is expected to announce what type of tariffs he intends to impose on countries that export more to the USA than they import from the country.
We are a global company that is used to working with these kinds of issues, so we'll see what the concrete proposals are. It's always difficult to take a stand before you have something to relate to, says Martin Lundstedt.
Does not rule out price increases
Last week, Trump announced that tariffs on all vehicles manufactured outside the USA will be introduced starting April 3. A month later - May 3 - these will be followed by tariffs on vehicle components.
The hope from the American administration's side regarding vehicle tariffs is to secure USA's domestic production. At the same time, the news agency Bloomberg estimates that the tariffs will reduce USA's GDP by 0.3 percent and increase inflation in the country by 0.2 percent.
In Sweden, the blow to the automotive industry risks being severe. According to Martin Lundstedt, AB Volvo's starting position is still stable. Nevertheless, he does not rule out price increases as a result of potential trade barriers.
The effect of tariffs and duties is unfortunately that you have to compensate for your own cost increases with price increases, he says.
Mexico factory stands firm
Whether it will become relevant to move parts of production to the USA is too early to speculate about, claims Lundstedt. On the other hand, he points out that a large part of the products sold in the USA are already manufactured on American soil.
The plans for the Volvo factory being built in Mexico stand firm.
We will need that capacity because there are several other markets in North America and our position in Latin America is also strong.
