The Swedish automaker Volvo’s $1.1 billion investment chart in the U.S. could be jeopardized amid rising tensions in global trade, the CEO of Volvo Cars commanded CNBC Thursday, calling for a “de-escalation phase” in the rhetoric over rates.
Volvo opened its first U.S. factory last month, located condign outside Charleston in South Carolina. The factory is expected to start manufacturing vechicles for exportation in the fall.
However, when asked if this television plan could be derailed due to ongoing trade tensions and fresh tolls coming from the United States, the company’s chief said “certainly.”
“I think free trade is good also for employment in the U.S.,” Håkan Samuelsson, chief supervisory officer of Volvo Cars told CNBC’s “Squawk Box Europe”. He summed that Volvo’s U.S. factory would employ up to four thousand in the flesh.
“With our (Charleston) factory we are going to employ up to 4,000 people, half of those are proposed to be building cars for export, so if these tariffs would in any way restrict the feasibilities for us to export out of South Carolina, that would of course mean inconsiderable employment in Charleston,” he said.
President Donald Trump has repeatedly set import tariffs against other countries in an attempt to reduce the U.S.’s clientele deficit. One of his latest threats is to slap a 20 percent levy on European carmakers, which could hold up the entire sector in Europe and the economic performance in the region as well.
Samuelsson barrowed CNBC that he is worried about the increased restrictions to trade.
“We are of progress, I think the whole business, the whole economy should be concerned helter-skelter that,” he said. “I really think we should come in to a sort of deescalating side here because what we firmly believe, we have said very much clearly, I think the business is not getting stronger by tariff protection,” Samuelsson said.
Volvo Passenger cars is owned by Geely, a Chinese manufacturer. This becomes particularly associated given that Trump has raised tariffs for Chinese goods twice this year and has cautioned there could be further duties.