Volvo Will Add Production of the XC60 to its South Carolina Factory

• This should increase production of the facility by two-thirds.

• The plant currently makes the EX90 and Polestar 3 large electric SUVs.

• Production of the XC60 is expected to start in January 2027.

In order to better utilize its American factory and circumvent some U.S. import tariffs, Volvo will shift part of the XC60’s production to South Carolina starting in January.

Indeed, the Swedish automaker is preparing its American manufacturing facility in Ridgeville, near Charleston, for the production of its most popular model.

This decision makes sense, since manufacturing the XC60 within one of its largest markets will reduce transportation costs for the automaker, and it will allow it to make its U.S. factory profitable more quickly.

This last factor is important, since the Charleston plant has never matched its 150,000-vehicle yearly production capacity, especially since the S60 was discontinued in 2024.

This left only the top-of-the-line EX90 and Polestar 3 electric crossovers coming down the production line, which has led to an overall utilization rate of only about 15%.

To rectify this, Volvo will produce a proportion of the XC60s it sells in the United States in South Carolina rather than in Belgium, as it has done since the popular SUV was introduced in 2008.

According to the president of Volvo Cars America, adding production of the XC60 in Charleston will boost the factory’s output by about 20,000 vehicles initially, which is two-thirds of its current production levels of about 30,000 units.

This will require adding at least a full shift, which should also boost employment in the area, and the company is expecting to increase its American production further in the coming years.

While this will likely be done by increasing XC60 output, the South Carolina factory is also earmarked to produce a new flagship plug-in hybrid SUV that will slot above the XC90 in order to compete with the likes of the new Audi Q9, the BMW X7, and the Mercedes-Benz GLS. This new model is expected to arrive in 2028.

The XC60 itself should get a significant refresh next year, with a larger battery for plug-in models, which should help it compete with newer PHEVs, such as the Mercedes-Benz GLC 350e, which has up to 87 kilometres of electric range, compared to the current XC60 T8’s 58 kilometres.

The company also hopes to increase its American sales with the expected arrival of a heavily reworked XC40 and the new EX60 electric SUV.

This comes at a time when Volvo’s U.S. sales dropped by 12% in the first half of 2026 compared to the same period in 2025, in part due to the discontinuation of the U.S. federal tax credit for EVs and PHEVs, along with tariffs on imported vehicles.

Making the XC60 in the United States will not shield Volvo from tariffs entirely, since the automaker will keep importing parts from Europe to assemble the SUV in South Carolina, but it should still help lessen the effects of these tariffs on the completed vehicle’s price tag.

Source: Automotive News