U.S. decision allows Volvo Cars to keep importing connected vehicles

Volvo wins a US car fight

Meet the rule that could have created a major problem for Volvo. It is called the Securing the Information and Communications Technology and Services Supply Chain: Connected Vehicles rule.

The rule restricts connected vehicles and certain connected-vehicle technology linked to China or Russia, with key software restrictions beginning with 2027 model-year vehicles and VCS hardware restrictions beginning with 2030 model-year vehicles.

What the ICTs rule really means

The ICTS Connected Vehicles rule focuses on two categories: Vehicle Connectivity Systems and Automated Driving Systems. Vehicle Connectivity Systems include hardware or software that enables radio-frequency communications above 450 MHz, such as cellular, Bluetooth, Wi-Fi, satellite, and telematics components.

Automated Driving Systems are hardware and software that can perform the entire dynamic driving task on a sustained basis.

For 2027 model-year vehicles, the rule restricts connected vehicles from manufacturers owned by, controlled by, or subject to the jurisdiction or direction of China or Russia, along with vehicles using covered software linked to those countries.

Volvo needed a specific authorization because its majority owner is China’s Geely Holding, and the Commerce Department granted that authorization after a case-by-case review.

Why Volvo needed this approval

Volvo is Swedish by birth but has been Chinese-owned since 2010. That ownership put them on the government’s watch list. Without this approval, they would have faced a tough choice: redesign all their car software or leave the American market entirely.

That would have been a disaster. Volvo sells over 120,000 cars a year in the U.S. Its dealers would have empty lots. But after proving their data stays in America and doesn’t go to China, the Commerce Department gave them the green light.

Your data stays here, not in China

Worried about your driving data leaving the country? Volvo promised that it won’t happen. They showed the government that U.S. customer data never gets sent to China. Instead, it’s stored in local data centers right here in America.

The CEO said their setup is no different from other Western car brands. That helped convince officials. Volvo also has an independent board and closed software systems. All of that keeps your personal information safe from foreign access.

Volvo is building more in America

You’ll soon see more Volvos with Made in USA stickers. Their South Carolina plant near Charleston already builds the EX90 electric SUV. By late 2026, they’ll start making the XC60 midsize SUV there, too. That’s Volvo’s best-selling model worldwide.

A brand-new hybrid model is coming to that same factory by 2030. It’s designed just for American drivers. Volvo wants half of its U.S. sales to come from local production within five years. That means more jobs and faster delivery for you.

Little-known fact: The South Carolina plant has a capacity of 150,000 cars per year. But right now it’s only running at 13% capacity. Adding new models will help fill that space.

Jobs and money in South Carolina

That plant in Ridgeville, South Carolina, isn’t small. Volvo has invested over $1.3 billion there in the last decade. It currently employs about 2,000 people. But that number is about to grow. The plant plans to hire up to 4,000 workers in the coming years.

The state gave Volvo over $200 million in incentives to make that happen. Local leaders are thrilled. The plant makes the EX90 and Polestar 3 today. Adding the XC60 and a new hybrid will push them toward full production.

Volvo dealers across the country

Volvo isn’t just a few big-city showrooms. They have 281 dealers spread across 48 states. Those dealers employ around 11,500 people. That’s a lot of families relying on Volvo to stay in business.

If the ban had gone through, those jobs would be at risk. Dealers would have no cars to sell. But with the approval secured, they can keep ordering 2027 models. Volvo’s U.S. headquarters in New Jersey employs another 400 corporate staff.

Polestar is still waiting

Volvo has a sibling brand called Polestar. They make sleek electric cars like the Polestar 3. Polestar is also majority-owned by Geely. But they didn’t get the same approval as Volvo. Not yet, anyway.

Polestar said they continue working with U.S. authorities. They want to meet all the requirements. Volvo’s success might help them. But for now, Polestar’s future in America is less certain than Volvo’s.

Congress wants even tougher rules

Even with Volvo’s approval, the fight isn’t over. Some lawmakers want a permanent ban on any car with Chinese ties. No exceptions, no special authorizations. That would erase Volvo’s victory completely.

Those proposals are still making their way through Congress. They could pass later this year or next. So Volvo’s approval might not be permanent. For now, they’re safe. But car buyers should watch what happens in Washington.

How Volvo proved they’re safe

Volvo didn’t just ask nicely. They had to show real proof. They demonstrated that their data-handling protocols are secure. They proved that their software architectures are closed and cannot be accessed from China.

They also showed they have an independent corporate board. That board makes decisions without foreign interference. After months of detailed talks with the Commerce Department, officials were convinced. Volvo isn’t a spy risk.

The XC60 is coming to America

The XC60 is Volvo’s most popular SUV. American drivers love it for safety, luxury, and Scandinavian design. Already in 2025, over 33% of Volvo’s U.S. sales were XC60s. A quarter of those were plug-in hybrids.

Starting in late 2026, the XC60 will be built in South Carolina. That’s big news. It means faster delivery and lower prices for American buyers. It also secures local jobs at the Ridgeville plant for years to come.

Little-known fact: Over 2.7 million XC60s are on the roads worldwide today. It recently became Volvo’s all-time best-selling model, even beating the classic 240 wagon.

Volvo changes electric plans

For years, Volvo said it’d go fully electric by 2030. No gas engines at all. But last year they changed their mind. Now they say hybrids will remain part of their lineup. That includes the new hybrid model coming to South Carolina.

Why the change? Customers still want choices. Some aren’t ready for full electric. Volvo listened. They’ll offer plug-in hybrids, mild hybrids, and full EVs. The U.S. market gets exactly what it wants.

If you’re wondering why many drivers are still hesitant to go fully electric, check out how drivers feel the squeeze as U.S. gas prices climb to year’s high levels for a closer look at the costs shaping consumer choices.

What this means for car buyers

So here’s the bottom line. You can still buy a new Volvo with all the connected features. Apple CarPlay, live maps, over-the-air updates, it’s all there. No weird gaps in the lineup. No missing models.

Volvo is doubling down on American production. That means more jobs here and faster service for you. Their approval shows that Chinese-owned brands can sell in the U.S. if they play by the rules. For now, go ahead and test drive that EX90.

If you’re interested in how government decisions can shape everything from immigration to the cars we drive, check out how a central deportation issue is putting the U.S. left’s views in focus for another debate influencing America’s future.

What’s your take on Volvo getting a special U.S. pass? Drop a comment below, and if you found this slideshow helpful, give it a thumbs up.

This slideshow was made with AI assistance and human editing.

Read More From This Brand:

• California revokes truck licenses under expanded enforcement effort
• Climate and environmental risks reshape where buying property makes sense
• Giant clay mushrooms and ancient monsters: Nebraska’s most overlooked park delivers both