Volvo Cars and the EU import tariffs on China-made electric cars: what it means for the EX30

Volvo Cars has signalled that it is uneasy about the European Union’s (EU) provisional import tariffs on electric cars built in China.

The topic came up during the presentation of the company’s second-quarter results, when CEO Jim Rowan addressed questions about the EU’s additional import duties and what they could mean for the manufacturer.

Volvo EX30 at the centre of the EU import tariffs

The concern is closely tied to the new EX30, which has been the main driver of Volvo’s growth this year and is already the third best-selling electric model in the European market. Crucially, it is also the only Volvo model that is manufactured in China and sold in Europe.

That is why it matters to understand what effect the extra import tariffs - an additional 19.9% in Volvo’s case - could have not only on the EX30, but also on Volvo’s overall performance.

Rowan began by saying that, given the “turbulent environment”, the brand’s results were very satisfactory, “which is already a good starting point”.

Even so, he underlined that while business is going well, any further increase in tariffs on China-built electric cars could become a short-term challenge.

EX30 production to move to Ghent, Belgium

It is worth recalling that the Swedish carmaker has already announced plans to shift EX30 production to Europe in the second half of 2025’s first semester, to Ghent, Belgium.

“Until we can start producing the EX30 in Belgium, we’re going to try to understand what the impact of the tariffs will be in the second half of this year.”
Jim Rowan, CEO of Volvo Cars

Uncertainties

Volvo Cars CFO Johan Ekdahl echoed those uncertainties. He said that, although “it is not possible to quantify exactly the precise impact of these tariffs, it is clear that they will have some influence”.

“We don’t know the exact outcome of these tariffs, because this is a dialogue that is still ongoing with the European Commission.”
Johan Ekdahl, CFO of Volvo Cars

Despite strong demand and the EX30 posting very positive gross margins (20%), the CEO said that “we are looking at all the options available”, and did not rule out a price change for the electric SUV. In Portugal, the Volvo EX30 starts at €39,554.

Other concerns

Still on the subject of import tariffs, Rowan also voiced concern that the United Kingdom - Europe’s second-largest market - has not yet decided whether it will apply the same duties that the EU has introduced on a provisional basis.

Beyond tariffs, the Volvo Cars CEO was also questioned about China and the ongoing price war in that market. Rowan said the market “is very turbulent and has far more competition than there was in the past.”

However, he added that the brand’s approach, particularly for electric models, is not to compete in the mass market, but to remain in the premium segment.

“We’re staying in the premium segment, which allows us to survive the turbulence, and this should last between 18 months and two years”.
Jim Rowan, CEO of Volvo Cars

Rowan also raised wider geopolitical concerns, including the US presidential election, as well as the fact that US import tariffs on batteries have risen from 7% to 25%.

Even so, he stressed that regardless of these worries, “the important thing is to make sure you have a resilient supply chain.”

“You can’t predict turbulence in the automotive industry, or where it will be, so instead of trying to guess, we have to make sure we have a more resilient supply chain than we did before.”
Jim Rowan, CEO of Volvo Cars