What’s Happening & Why This Matters
Volvo Cars has revealed plans to decrease its stake in Polestar, its separate electric car brand. The move will see Volvo’s shareholding in Polestar drop from 48 to 18 percent. To achieve this, Volvo Cars intends to distribute 62.7 percent of its current Polestar stake to existing Volvo Cars shareholders. Volvo values the stake at 9.5 billion Swedish krona (approximately $1.4 billion).
t/f Summary: What’s Next
Polestar continues to face challenges with production and financial performance. As a result, Volvo’s influence on Polestar will be reduced, and Geely will take full responsibility for funding the struggling electric car brand. Despite this, Volvo and Polestar will continue collaboration as they are tied operationally.