Volvo secured Commerce Department approval after proving data protections
Volvo Cars, the Swedish automaker majority-owned by China’s Geely, plans to deepen its use of shared mechanical components with its parent while keeping vehicle software systems separated by region, Chief Executive Håkan Samuelsson said in a Wall Street Journal interview published Monday.
“Our cars in China will be much more Geely-based, while Europe and America will have locally developed Western software systems,” Samuelsson said. “But in mechanical parts, why not? Why shouldn’t cars in Europe have the same brake caliper or the same air-conditioning compressor as cars in China? And if we can find such common components, we can lower the cost of the hardware.”
The strategy comes as Volvo is owned by a Chinese company while operating a U.S. factory and selling vehicles in the American market. Congress is debating a legislative ban on Chinese cars.
Volvo secured an exemption from the Commerce Department’s ICTS rules — restrictions introduced in 2025 on Chinese software and connectivity technology in vehicles — by demonstrating how it handles data from connected cars, Samuelsson said.
“Yes, they could very well be” vehicles with Chinese software components, Samuelsson said. “But we will be totally open with that and not in any way jeopardize the ICTS regulations.”
“We needed to show how we treat and handle data coming from connected cars—how do we protect the national interest of the U.S., how does it work, who has access to data from the car, who has access to software and so on,” he said. “It was a very detailed discussion to show that in this respect we are definitely not a Chinese company. When we had proven that, then we got approval from the Commerce Department.”
Samuelsson drew a line between Volvo and other Geely-linked brands, particularly Polestar, which he described as “more of a Chinese newcomer” than the Swedish marque.
“The idea with the American initiative, I think, is to make it difficult for new Chinese players to come in,” Samuelsson said. “Volvo was in America long before we were Chinese. In that respect I hope they see Volvo in another context than any Chinese newcomer, including Polestar, which is still probably more of a Chinese newcomer.”
On whether Chinese automakers could earn broader access to the U.S. market, Samuelsson said they could — by manufacturing locally.
“They could be, but I think [Chinese automakers] really need to be good citizens and build the cars in America, develop the cars in America, use American suppliers,” he said. “Then I see no reason why they should not be on the market, exactly as Toyota is now on the streets of America.”
To expand its U.S. footprint, Volvo plans to begin producing the XC60 at its Charleston, South Carolina, plant shortly after the new year, Samuelsson said. The factory has been underutilized since the company’s earlier bet on electric vehicles did not generate sufficient volume.
“We cannot end up having a factory and not using it,” Samuelsson said. “Even without Trump’s measures I would still argue: Why don’t we use the factory we have? Can we build more cars there that are more suited to American consumers?”
The first step is the XC60, he said, but Volvo also needs additional models aimed at American preferences. “If you look into what Americans need: number one is more multifuel capability,” he said. “It cannot be only EVs, it should be multifuels, to leave that choice to the consumer.”
Larger vehicles are also a priority. “Americans love big SUVs,” Samuelsson said. “So why don’t we listen to that?”
Fully utilizing the Charleston plant will create jobs in the medium term, Samuelsson said. “If we are fully utilizing the factory, in the medium term, that will create jobs.”
On the broader U.S. auto market, Samuelsson said conditions are “very depressed.” “The consumer willingness to buy is very low,” he said, attributing the slowdown to fuel prices and developments in the Middle East. “Incentives can only help in the beginning. They cannot drive a long-term change.”
Despite those headwinds, Samuelsson argued that EVs remain the better technology. “Electric cars are better cars,” he said. “They are cheaper to drive. They are quiet. They are more agile. The only drawback with an electric car is you need to charge it at home, or fast-charge it when you’re out on the road. And that’s the only limitation, but I think one which is being invested away as we speak.”
He acknowledged that U.S. conditions are not always favorable to EVs. “In countries where electricity is rather expensive and gas rather cheap, it is a problem,” he said. “Gas is still rather inexpensive in the U.S.!”
Samuelsson, who returned as CEO more than a year ago, said the industry environment is unusually difficult for three reasons: deglobalization, the technology shift from gasoline to electricity, and new competition from Japanese, Korean and Chinese automakers.
“The world is deglobalizing: new tariffs, tech restrictions,” he said. “One-size-fits-all doesn’t work anymore. You need to go to the regions and listen to the customers and deliver what the customers want. Otherwise we will not be global brands anymore.”