Volvo had barely savored its new factory in Charleston, South Carolina, before newly imposed tariffs threatened the its future. The South Carolina plant was recently opened to build the all-new S60 sedan as well as the next-generation XC90 SUV. Volvo was set to hire around 4,000 new employees, but Automotive News Europe reports these plans might be up in the air due to the fear of tariffs. President Trump is currently pushing for a 25% tariff on imported vehicles coming into the United States.

If these tariffs are imposed, it could have a major effect on Volvo's new factory. "If you have trade barriers and restrictions, we cannot create as many jobs as we are planning to," said Volvo CEO Hakan Samuelsson at an event celebrating the new facility. Samuelsson explained how tariffs have the potential to cripple foreign automakers like Volvo. "We want to export and if suddenly China and Europe have very high barriers, it would be impossible. Then you have to build the cars there. And then all cars will be more expensive, you have to invest more tooling and have every model in every country. That's against all the logic of modern economies that trade with each other" he said.

The S60, which will be built it the US, will be safe from the tariffs. However, S60 cars that are exported to other markets would be hit. In a separate interview, Samuelsson compared the auto industry with 25% tariffs to a bad restaurant. "I would have less models to choose from and they would cost more - that would be the consequence," he said. "Shorter menu and higher prices - not a very good restaurant."