STOCKHOLM — Volvo Cars cut its full-year retail sales forecast on Thursday, blaming European tariffs on EVs made in China that will hit one of the Swedish automaker’s key electric models until it shifts production to Belgium.
While reporting better than expected second-quarter results that sent its shares up 6% in morning trade, Volvo lowered its forecast for sales growth this year to 12%-15%, down from 15%.
“It’s really driven by tariffs,” CEO Jim Rowan told Reuters. “It’s a short-term issue for us, but it is an issue and we’re just going to have to deal with that.”
Rowan said that while Volvo still hoped for 15% growth, it was now providing a range given the uncertainty.
“We wanted to put a floor on that for the markets to say we’re still going to grow but there are some headwinds,” he said.
Earlier this month, the EU announced provisional tariffs of up to 37.6% on imports of EVs made in China, saying they benefited from unfair subsidies — an allegation Beijing rejects.
Volvo is majority-owned by China’s Geely and faces a 19.9% tariff on its Chinese-made fully-electric EX30.
Rowan said the Swedish automaker faced a “minimum of six months” of tariffs until it moves EX30 production to Belgium, which is expected to start early next year.
Volvo said the main ramp-up of EX30 production at its factory in Ghent was expected during the second half of 2025.
Bernstein analysts said in a note that the new sales guidance was “sensible given today’s macroeconomic situation.”
