According to media reports, Swedish automaker Volvo Cars has implemented significant cost-cutting measures in the United States in response to ongoing global market uncertainties. Sources familiar with the matter revealed that Volvo has laid off around 15% of its U.S. commercial workforce, affecting approximately 60 positions, primarily at its headquarters in Mahwah, New Jersey. Some of the reductions were achieved through natural attrition.
Insiders noted that the layoffs have not been publicly announced, and most of the affected employees were hired during the COVID-19 pandemic. It is important to point out that Volvo's U.S. plant workers are not part of this round of job cuts.
A Volvo spokesperson stated: "We are taking steps to streamline and simplify our organization and to build a more structurally efficient cost base. These adjustments will help us create a more profitable future in the Americas and globally."
The U.S. market remains critical for Volvo. Despite delivery declines in Europe and China during the first half of this year, Volvo's U.S. sales rose 6% year-over-year to 64,680 vehicles. Globally, however, the company's overall deliveries dropped 9% year-over-year.
This wave of U.S. layoffs is part of Volvo's broader global cost-cutting strategy. After the company reported a 60% plunge in operating profit in Q1 2025, it initiated an aggressive cost reduction program. In May, Volvo announced plans to cut 15% of its global workforce-about 3,000 positions-mostly in Sweden.
Volvo CFO Fredrik Hansson commented: "This restructuring is aimed at making us more structurally efficient. We are reviewing all possibilities." The company is targeting cost reductions of SEK 8 billion (approximately USD 1.87 billion) to offset weakening demand in the U.S. and ongoing tariff-related issues. Notably, 90% of the vehicles Volvo sells in the U.S. are imported. As a result, the company has decided to withhold its financial forecasts for 2025 and 2026.
In terms of production capacity adjustments, Volvo's plant in Ridgeville, South Carolina, also experienced layoffs earlier this year. In May, the plant cut around 5% of its workforce (approximately 125 employees) due to shifts in market conditions and changes in trade policy, including tariffs.
The Ridgeville facility spans 2.3 million square feet and is designed for an annual production capacity of 150,000 vehicles. However, according to data from Automotive News Research and Data Center, the plant produced only 20,000 vehicles last year-just 13% of its intended capacity. With production of the Volvo S60 sedan at the site having ended a year ago, the facility currently only manufactures two fully electric crossover models: the Volvo EX90 and the Polestar 3.
To better utilize the Ridgeville plant's capacity, Volvo is reportedly considering producing a higher-volume model at the facility. The Volvo XC60, a popular mid-size plug-in hybrid crossover, is seen as a leading candidate. In May, Volvo CEO Hakan Samuelsson remarked: "We hope to introduce a high-volume model as soon as possible. A core mid-size car would be a strong option."
