Volvo opens 1st US plant amid tariff threats
New York: Auto manufacturer Volvo Cars has opened its first North American plant in Charleston in the US even as its CEO expressed concerns over President Donald Trump's tariff threats.
According to a statement, the new plant will start manufacturing S60 model sedans in August and XC90 SUVs from 2021, Xinhua news agency reported.
Volvo Cars currently has two car manufacturing plants and an engine factory in Europe, three car factories and one engine factory in China, as well as assembly lines in India and Indonesia.
The Charleston plant has the capacity to manufacture 150,000 automobiles annually, potentially creating 4,000 jobs, Volvo Cars President and CEO Hakan Samuelsson said at the plant's opening ceremony on Wednesday.
About half of the parts the plant needs come from overseas suppliers and half of the manufactured cars target overseas markets, Samuelsson said, adding that an "open and fair" trading environment was important for the plant's success.
If the US government goes ahead with its proposed tariffs against other countries, it would drive up costs, reduce profits and ultimately limit the number of jobs the plant can sustain, Samuelsson said, adding that tariffs can put as many as 2,000 jobs at risk.
Samuelsson said Volvo Cars had voiced its concerns to some US lawmakers and expressed the hope that all sides would be able to resolve differences through talks.
Volvo Cars said construction for its US plant broke ground in 2015 and the company has invested up to $1.1 billion in the plant.
Volvo Cars said it chose Charleston because of its easy logistical access, mature supply chain and healthy supply of skilled workers.
The car company, headquartered in Sweden, was established in 1927 and was acquired by Chinese car maker Geely in 2010.