Volvo is the latest automaker to feel the pain after the United States largely pivoted away from electric vehicles.
Volvo’s 2026 lineup is largely focused on EVs, even retiring its more traditional sedans in the U.S. This was a smart choice in the early 2020s when President Biden was pushing for an all-electric future. But removing the tax incentive on new electric vehicle purchases slowed that down, and many automakers suffered as the government reversed its stance on EVs.
And 2026 is not a good time for drivers to lose interest in your vehicles. With President Trump’s ongoing tariffs and rising new-car part costs, Volvo has struggled to stay profitable. And it’s not just in the U.S. Its revenue dropped by almost 50% in the third quarter of 2026 in China, a market that has become difficult for many automakers that can’t keep up with low-priced competitors.
In total, the company reported an operating loss of $373 million in the third quarter of 2026.
“The third quarter of 2026 was very disappointing and reflects a year that has become far more challenging than originally anticipated. Our ongoing turnaround plan therefore needs a decisive reinforcement,” CEO Hakan Samuelsson said.
Volvo cuts more jobs and spending amidst massive losses
To deal with the troubling 2026 sales and finances, Volvo has announced 2,500 layoffs, largely in Sweden. On top of that, Volvo said it would cut indirect spending, hoping to see savings by the end of next year.
Some 2,500 jobs will be lost globally, with 2,000 in Sweden, as the group ends consultant contracts, applies natural attrition, and offers “targeted exit packages” to employees, Volvo said in a statement. Further cuts were not denied nor confirmed.
Unfortunately, this is part of a growing trend for Volvo, which cut 3,000 jobs in 2025 when Samuelsson returned as CEO. This was part of last year’s budget cuts.
Chinese company Geely currently owns over 78% of the company’s shares. Despite this, Volvo is still allowed to sell vehicles in the U.S. thanks to special government authorization. Polestar can’t say the same.
Volvo’s sales reveal EV troubles
Volvo is more popular than Polestar in the United States, but it’s not looking good for the brand. In 2025, Volvo sold 121,607 vehicles, a slight decline from 2024. On top of the decline, Volvo is making less money per vehicle because of tariffs and rising costs. That’s where the trouble really is.
The Volvo XC60 was the best-selling model of 2025, with 41,105 sales. It is a family favorite in the U.S. for its muscular, simple look and luxury interior. It’s safe, comfortable, and reliable. The Volvo XC90 isn’t too far behind with 40,217 sales. This three-row SUV is roomy, comfortable, and convenient. The XC40 is next with 22,014 sales.
After that, Volvo’s electric options follow, but they are far behind. The Volvo EX30 had 5,409 sales, and it gets worse from there. Volvo’s electric vehicles have been known for troubling software bugs and charging issues, which means the new technology is more frustrating than beneficial for drivers. Despite this, it started at $80,000.
And you know how Americans feel about rising new-vehicle prices.
At a glance, Volvo has some possibly diabolical ideas for 2027 that don’t quite make sense to me. They want to expand their electric vehicle lineup based on its SPA3 platform. The focus is a smaller, more affordable EV. Possibly under $40,000.
Doubling down on EVs is a choice.
I think its EVs are doing well in Europe, making it difficult to pivot away from them. But I am not sure it will play out in America.
