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When Volvo's South Carolina Launch Got Awkward

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Nikki Haley, who President Trump nominated to be U.S. Ambassador to the United Nations shortly after his inauguration, was in Ridgeville, South Carolina at the opening of Volvo’s new $1.1 billion assembly plant on Wednesday when Sweden’s Ambassador to the U.S. Karin Ulrika Olofsdotter took the stage and fired a broadside against the Trump administration. For an event designed simply to launch a new sedan—the American-built 2019 Volvo S60, in this case—it was unusually awkward.


Unlike the other speakers, Olofsdotter’s remarks did not appear on the teleprompter; instead she appeared to be reading from some written notes. And so it happened that after lauding the opening of the plant, she got down to the business of politely calling Trump’s trade war stupid, as Haley—the former South Carolina governor turned Trump official—sat in the front row.

“We are a bit worried about the trade agenda. We are worried about the steel and aluminum tariffs,” Olofsdotter said. “And of course extremely worried about possible car tariffs.”


She then said simply, “A plant like this does not need that.”

It was a weird scene, since in addition to inaugurating the plant, Volvo was also there to reveal the third-generation S60, with all of the attendant trappings: dozens of journalists and an even greater number of Volvo employees whose task it is to make the journalists’ jobs as easy as possible.

It’s safe to say that Volvo wanted, maybe even expected, laudatory coverage but here, halfway through the reveal itself was a big reminder of the dissonance of Volvo being in South Carolina.


The automaker today has Chinese owners, but it’s still very much steeped in the empathetic values of the Swedish welfare state, and the company’s culture, many employees told me unprompted, is “centered around people,” as opposed, I guess, to robots.

Still, in Sweden at least, that also means unions, which dominate several industries across the country, including at Volvo itself. But South Carolina is a right-to-work state, giving employers enormous power over their employees, and surely this figured into Volvo’s reasoning for building a giant factory there, as it has for other automakers, including BMW, whose massive (non-unionized) South Carolina plant churns out nearly 400,000 cars every year.


Volvo’s South Carolina is non-union, too, of course, and seemingly will remain that way for awhile; Javier Varela, Volvo’s Senior Vice President Manufacturing and Logistics, said Wednesday that the company had not been approached by the United Auto Workers, nor was he aware of any ongoing unionization efforts.

But Varela also noted, “We just got here.”

There’s another reason Volvo found South Carolina attractive, of course: cold, hard money, which brings us back to Haley, who offered $200 million in public money to woo Volvo under her governorship. Håkan Samuelsson, the company’s CEO, said they had better offers elsewhere—Georgia and Kentucky were also considered, in addition to Mexico, which Samuelsson said would’ve been far cheaper than anything stateside. But Volvo wanted to be in the States, mainly for optical reasons.


And yet, optically, it was strange on Wednesday, as Volvo lauded Haley and current South Carolina Governor Henry McMaster, both of whom are strong supporters of a leader who wants major tariffs that could hit foreign automakers pretty hard. Olofsdotter’s casual and quietly defiant remarks on an occasion not ordinarily suited for them made clear just how bizarre bedfellows business sometimes makes.

“If you have trade barriers and restrictions, we cannot create as many jobs as we are planning to,” Samuelsson said on the sidelines of an event celebrating the new plant to Reuters. “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.”


But Volvo seems to be hedging against that very possibility. The South Carolina plant is its first here, and its people said flexibility of Volvo’s manufacturing means that the plant could be retrofitted to make any of Volvo’s cars for the American market. (They will make just the S60 there initially, a soft launch, since the S60 sells better abroad. Plans to also make the XC90 there by 2021 continue apace.)

I asked a Volvo spokesperson for comment about this whole thing. The spokesperson said, “We support free trade.”