Sweden opposes tariff increase on Chinese cars. Foreign Trade Minister Johan Forsel told reporters that “Sweden is a strong supporter of free trade and open markets”.
The official made it clear: protective tariffs against China could have negative consequences for Sweden. The thing is that some Volvo and Polestar cars are made in China and are classified as the Chinese car industry.
Swedish journalists believe that the EU's current protective tariffs are destroying Volvo's electric vehicle strategy. "Never before have punitive tariffs in the looming trade war been more wrong and more ill-timed," writes Dagens Nyheter.
Volvo has tied its near-term future to the Chinese-assembled EX30 compact electric car. Thirty percent tariffs in Europe and 100 percent tariffs in the US mean that the current supply doesn't make any sense.
Volvo's plant in Ghent, Belgium won't be able to produce sufficient quantities of the EX30 until mid-2026. The two-year delay will disrupt Volvo's entire strategy in Europe.
The only way out is the removal of protective tariffs on Chinese cars. For this, it is necessary to achieve a majority of the votes, but so far there is none, although the German authorities also oppose the trade restrictions.
Volvo is unlikely to be added to the list of exceptions, as the Swedish brand belongs to Geely, a strong competitor that intends to displace the Europeans with the premium brand Zeekr.
Swedish authorities are ready to lobby the interests of Volvo in Brussels, but the most to achieve a reduction in tariffs, believes Cecilia Malmström, former EU trade commissioner.
Ms Malmström stressed that politicians in the European Union face a choice: either protect domestic industry or continue the “climate” agenda, which de facto means a switch to cheap Chinese electric cars. Neither Europe nor China wants a full-scale trade war, so compromises are likely.