Volvo may complete production of Volvo S60 sedanJuly 22, 2020
The luxury sedan may disappear from the Swedish automaker’s plans.
No sooner had the third-generation Volvo S60 arrived in 2019 than production was immediately discontinued: it was the first Volvo built in the United States at the automaker’s new plant in South Carolina, near Charleston, which, as is the case with other manufacturers, is Swedish. the company was forced to close at the end of March due to the coronavirus pandemic. It reopened in mid-May, but was forced to close again in June due to supply problems that are currently causing problems for the S60.
In an interview, Volvo CEO Hakan Samuelsson said he hoped the plant in the United States would be rebuilt and up and running “within weeks” after two problems were resolved. First, there are problems with the supply of spare parts from Mexico. Second, there is the problem of supply and demand for the S60: buyers are increasingly preferring SUVs.
Volvo sales in the first half of 2020 confirm this. SUVs accounted for 69% of Volvo’s global sales, while sedans, including the S60, only 14%. In fact, S60 sales in the US market alone were down 25%, although global sales were up 55%. The final annual report on the S60 will be released later, but the poor result is hardly Volvo’s fault. However, Volvo may regret its decision to build the S60 in its only US plant.
“Charleston really needs an SUV, which we plan to introduce in a second round in 2022 with the XC90,” Samuelsson confirmed. “Then the plant will be completely utilized.”
Volvo’s US strategy is the opposite of BMW and Mercedes-Benz. Rather than building only sedans or not producing them at all in the United States, both German automakers build SUVs in South Carolina and Alabama, respectively. Mercedes has already announced plans to end production of the C-Class sedan in Alabama due to declining sales, but the soon-to-be-sold factory floor will be dedicated to another all-electric crossover, the EQ.
But if sales of the Volvo S60 do not ultimately return to acceptable levels, it could face the same fate as the rival Mercedes-Benz C-Class sedan.
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