Geely-owned Volvo Cars is planning to shift US-bound production of its XC60 to avoid US import tariffs on cars made in China.

The company is shifting XC60 SUV production for the US market to Europe (Torslanda) from China to avoid new US duties.

Håkan Samuelsson, president and chief executive, told Reuters that the company is planning to "reshuffle" XC60 production so that the European plant makes cars for the US market with China producing for other markets.

Chinese XC60 production previously shipped to US dealers would be reallocated to markets including Europe, he said.

Volvo Cars has announced record quarterly profit for Q2 and is being readied for a stock market flotation.

The second generation XC60, which had its world premiere at the 2017 Geneva motor show, is based on Volvo's SPA architecture. In China, it is manufactured at the Chengdu plant. Volvo Cars is said to be investigating the potential of erecting an SKD or CKD plant in Russia, with the XC60 likely to be its first vehicle.