Volvo's launch of the new sedan model ES90 comes at the same time as President Donald Trump has chosen to escalate the tone with trade tariffs against Canada and Mexico, as well as increased punitive tariffs against China.
The new model is to be manufactured in China, which means it will be subject to tariffs when imported to Europe or the USA.
We'll see where the tariffs end up. The tariffs against Canada and Mexico have come and gone a bit. It's maybe a combination of facts and negotiating tactics. It's clear that it's something we need to navigate, then we'll see at what level, says the company's CFO Johan Ekdahl about the new developments.
One alternative could be to move part of the production to Charleston, South Carolina, USA, where Volvo Cars also has a factory, in order to avoid tariffs. At the same time, Johan Ekdahl emphasizes that the Chinese car market, which is also the world's largest, is extremely important for Volvo Cars.
It's an important car in China and we have a pretty strong position on sedan models in China. Then there are other countries in Asia, as well as the UK, which don't have any tariffs, he says.
No negative reactions were seen on the market on Wednesday. Volvo Cars' share rose 3 percent on the Stockholm Stock Exchange.
