Volvo's Extensive 1,600-Acre Problem May Prove to Be a Stealthy Asset Against Customs Duties
### Volvo Shifts Production Strategy at South Carolina Plant
Volvo Cars is making significant changes to its production plans at the Ridgeville, South Carolina facility. The company plans to start local assembly of the XC60 SUV in late 2026 or early 2027, followed by the XC90 in October 2028 [1][2][3].
Once fully operational, the plant is projected to produce 60,000 XC60s and 50,000 XC90s annually, accounting for the majority of Volvo’s U.S. market share for these models [2]. This shift is in part due to new 25% tariffs on imported vehicles and parts, which have made local production a more economically viable option [1][3].
#### Job Creation and Local Employment Impact
The addition of the XC60 and XC90 to the Ridgeville facility's production lineup is expected to require a substantial expansion in workforce and operational capacity [2]. While exact new job figures have not been officially released, scaling up to produce an estimated 110,000 vehicles annually for the U.S. market suggests a considerable increase in hiring for both direct and indirect employment (assembly line workers, engineers, logistics, supplier networks, etc.) [2].
Increased production and employment at the plant will likely spur growth in the local economy through higher demand for services, housing, and retail. Indirect job creation in the surrounding area—including component suppliers, transport, and maintenance services—is also expected to rise as the plant’s output expands [2].
#### Long-Term Stability
By localizing production, Volvo aims to stabilize its U.S. market presence and improve profitability despite shifting trade policies [1][2]. However, long-term job security will depend on sustained consumer demand for the XC60 and XC90, as well as Volvo’s ability to compete in the evolving luxury SUV segment.
#### Summary
| Change | Timeline | Impact on Jobs & Community | Key Driver | |---------------------------------|-------------------------|-------------------------------------------|--------------------------| | XC60 production starts | Late 2026–Early 2027 | Significant new hires expected | Tariffs, local demand | | XC90 production starts | October 2028 (planned) | Further expansion likely | Market strategy | | Combined annual output target | 110,000 units | Boost to local/regional economy | Cost competitiveness |
#### Outlook
Volvo’s decision to produce the XC60 and XC90 in South Carolina signals a major commitment to U.S. manufacturing, with clear expectations for new job creation and a positive economic impact on the local community. The scale of opportunity will depend on production volumes and market reception, but the overall direction points toward growth in employment and regional economic activity in the coming years [1][2][3].
As of 2021, the Ridgeville factory was employing about 860 hourly workers [4]. This number is expected to increase significantly as production ramps up. The Ridgeville factory, initially intended to be the cornerstone of Volvo's plan to become an EV-only brand by 2030, might end up being a secret weapon against tariffs.
[1] https://www.reuters.com/business/autos-transportation/volvo-to-make-us-suvs-south-carolina-2023-07-16/ [2] https://www.greencarreports.com/news/1138486_volvo-xc60-production-to-shift-to-south-carolina-factory [3] https://www.autonews.com/automakers/volvo-to-build-xc60-and-xc90-in-us-by-2028 [4] https://www.postandcourier.com/business/volvo-cars-reports-860-workers-at-south-carolina-factory/article_c61230a8-544f-11ed-a38a-483e757c92b8.html
- The automotive industry's financial aspect is significantly impacted as Volvo Cars plans to locally assemble both the XC60 and XC90 SUVs at their Ridgeville, South Carolina facility, altering the production strategy to reduce costs linked with the new 25% tariffs on imported vehicles and parts.
- The transport and business sectors are expected to benefit from this automotive news as the expansion of Volvo's production at the Ridgeville plant to accommodate the XC60 and XC90 models is anticipated to create a substantial number of jobs, boosting the local economy with increased demand for services, housing, and retail.
- As technology continues to advance and consumer preferences evolve, the long-term success of Volvo's local production strategy will rely heavily on the demand for the XC60 and XC90 models, as well as the company's ability to compete in the luxury SUV segment and maintain profitability, setting the stage for future growth in the automotive business.
