Volvo Cars Soars 21% as It Halts Subsidiary Polestar Funding
A Volvo C40 Recharge electric SUV is on display during the Volvo “A New Era of Volvo Cars” press conference at The Shilla Seoul on March 14, 2023 in Seoul, South Korea.
Surge in Volvo Cars Shares as Funding for Subsidiary, Polestar, Ceases
Stocks of Volvo Cars experienced a remarkable surge of over 21% following the Swedish automaker’s announcement to put an end to the funding of subsidiary, Polestar Automotive. This strategic decision has garnered significant attention from industry insiders and investors alike.
Strong Q4 Increases Volvo’s Net Sales in 2023
According to the latest financial statements, Volvo Cars has seen a notable 10% year-on-year increase in its fourth-quarter net sales, reaching an impressive 148.1 billion Swedish krona ($14.16 billion). This surge has resulted in a total net sales for the year 2023 amounting to 552.8 billion krona.
Volvo Mulling Handing Polestar Over to Majority Shareholder
News emerged from Volvo Cars that the luxury automaker is contemplating the transfer of stewardship for its ailing luxury car brand, Polestar, to major shareholder Geely Holding. Volvo Cars CEO Jim Rowan, in an interview with CNBC’s Silvia Amaro, confirmed the ongoing evolution in the relationship between Polestar and Volvo. In recent years, Volvo Cars has been nurturing and collaborating with Polestar, culminating in its transition from a one-car company to a three-car company. This strategic move is expected to propel Polestar toward a new growth trajectory.
Polestar’s Exciting Future Ahead
Jim Rowan further discussed Polestar’s upcoming roadmap, acknowledging the imminent launch of two heavily anticipated new car models in the first half of this year. This significant step forward reinforces Polestar’s potential for expansion and prosperity in the automotive market.
Volvo Cars to Focus on Growth Journey
The decision to reduce Volvo Cars’ shareholding in Polestar presents an opportune moment for both entities. By seeking external funding, Polestar can chart an independent course for the future. Simultaneously, this move would allow Volvo Cars to concentrate fully on its ambitious growth journey, in particular, the necessary technological investments to be made in the upcoming years.
