Trump’s tariffs blamed for Volvo layoffs in Southwest Virginia

Virginia Republicans are not backing off their support of the Trump administration’s severe import taxes, despite growing signs the trade war is tamping down business activity and hurting economic growth.

One of the largest auto manufacturers in the world is blaming President Donald Trump’s tariffs for the company’s latest decision to lay off hundreds of workers in Southwest Virginia. 

Volvo plans to lay off up to 800 workers across its operations in the US, including hundreds at a Volvo Group North America facility in Dublin, a small town about an hour west of Roanoke. The Virginia layoffs are expected to impact between 250 and 350 people at the Volvo Trucks New River Valley Operations in Dublin.

“Heavy-duty truck orders continue to be negatively affected by market uncertainty about freight rates and demand, possible regulatory changes, and the impact of tariffs,” a spokesperson for Volvo Group North America said in an emailed statement.

It is the second round of layoffs at Volvo’s New River Valley facility after the company announced a layoff of 250 to 350 workers in February. The current number of employees at the New River Valley location is about 3,400 people. Workers there are represented by the United Auto Workers Union, which is led by Shawn Fain, who has expressed qualified support for tariffs on the US auto industry. UAW did not respond to a request for comment. 

Since returning to the White House in January, Trump has levied tariffs on other countries at a frenetic pace and in a seemingly haphazard manner that has flummoxed some economists and irked parts of corporate America.  The US has imposed  145% tariffs on China, and China retaliated by  enacting 125% tariffs against American goods. 

The Trump administration has also levied 25% tariffs on imports from Canada and Mexico, but many goods from those countries are exempted under the United States-Mexico-Canada agreement, according to CNBC. Trump has also placed 10% tariffs on most imports from other countries. 

Read more: How another Trump trade war could hurt Virginia

Despite the layoffs at Volvo, the company maintains that the New River Valley plant is its flagship Volvo truck production plant and will continue to be part of the company’s growth strategy. 

“The commercial truck manufacturing industry is cyclical, and it is unfortunately not uncommon for us to have to reduce production and employment when we go through periods of reduced demand,” a spokesperson said in an email statement. 

Sign of the times

Given the history of layoffs at Volvo’s New River Valley facility, it is hard to say just how much tariffs played a role in the most recent announcement. But that a global manufacturer is blaming the Trump administration’s tariffs for its layoffs is a sign that the goal of bringing back US manufacturing with tax imports is unlikely to come without real, human costs. 

More broadly, the Trump-induced trade war is fueling fears about the health of America’s economy. The International Monetary Fund warned Tuesday that Trump’s tariffs will slow US economic growth to 1.8% in 2025, down from 2.8% in 2024 and a far cry from the roaring economy Trump promised on the campaign trail. 

Closer to home, manufacturing activity slowed in April across a region that includes Virginia, according to a monthly survey of firms by the Federal Reserve Bank of Richmond. Manufacturers in the region, which also includes the District of Columbia, Maryland, North Carolina, South Carolina, and most of West Virginia, reported reductions in their headcounts and expectations that more headcount reductions are likely. 

‘Southwest Virginia deserves better’

Virginia Democrats have condemned Trump’s trade policies while state Republicans have stood in support of them. 

The Republican nominee for Virginia governor in this year’s election, current Lieutenant Governor Winsome Earle-Sears, said in a leaked audio recording dated March 13 that she understood that tariffs can hurt, but that Trump’s unpredictability in using them was an effective negotiating tactic in extracting concessions from other countries. 

“Lieutenant Governor Winsome Earle-Sears supports trade policies that put America first,” Sears Press Secretary Peyton Vogel said in a statement to Dogwood. “The Youngkin-Sears Administration here in Virginia has delivered record job growth and new business investment. As governor, she’ll build upon that momentum to ensure Virginia businesses, workers, and families thrive.” 

Current Republican Gov. Glenn Youngkin has also repeatedly stood in support of Trump’s economic agenda and the trade war is no different. 

In a recent interview with CNBC, Youngkin said that despite the tariffs, he is not seeing economic paralysis, but rather big moves in Virginia’s economic development deals. Youngkin suggested he was okay with Americans suffering in the near-term, if it paid off in the long run.  

“What we’re seeing is the long-term investment and the confidence in the long-term investment, which I think is reflective of the words we keep hearing out of President Trump, which is, listen, there’s a dislocation in the near term,” Youngkin said on CNBC. “There’s long-term opportunity.”

Democrats, meanwhile, have criticized Trump’s use of tariffs. 

The Democratic nominee for governor, former congresswoman Abigail Spanberger, said in a statement to Dogwood that the Trump administration’s “reckless tariff policy is killing Virginia jobs and threatening local economies in the New River Valley” where the Volvo plant is, and across Virginia. She promised that as governor she would defend Virginia jobs and stand up to politicians in Washington who jeopardize them.

“Repeatedly enacting and then retracting tariffs is making it impossible for businesses to plan for the future — and creating unnecessary chaos for families who are feeling more and more strain on their wallets,” Spanberger said. “Virginia’s workers and manufacturers deserve steady leadership in Richmond.”

Lily Franklin, the Democratic candidate in the race for Virginia’s 41st House District, which includes parts of Montgomery and Roanoke counties, said on X there are real people behind the layoff numbers. 

“Hundreds of good-paying jobs gone—and nothing lined up to replace them,” Franklin said. “Folks are being left behind while we wait on promises. Southwest Virginia deserves better than this.”