Volvo Cars may not sell its high-performance Polestar electric vehicles in the U.S. if Washington slaps tariffs on imports from China, the Financial Times reported Wednesday.
The automaker recently revealed its Polestar 2, which executives said is priced competitively with Tesla's Model 3 sedan.
But Volvo is owned by Chinese auto company Geely, and the group has so far intended to make the cars at a factory in China. It expects to sell more than 50,000 Polestar vehicles.
A lot of those cars won't make it to the United States if tariffs on Chinese imports are too high, Polestar CEO Thomas Ingenlath told the FT.
The Polestar 2 is one of several vehicles automakers are hoping will draw customers from Tesla.
Competition is expected to heat up around the 2021 model year, said CFRA analyst Garrett Nelson. Competitors are already on the market at a midrange price that's competitive with the Model 3 and higher prices where Tesla's more premium Model S and Model X vehicles sit.
The global automotive industry has found itself caught up in President Donald Trump's trade war with China, leading many automakers to re-evaluate where they build and sell their products.