Volvo Vehicles will discontinue funding all-electric efficiency model Polestar, the Swedish carmaker mentioned as we speak in its 2023 monetary assertion. Describing this transfer as a “decisive transformation part,” Volvo plans to reallocate funds from Polestar in direction of its personal initiatives. The choice comes within the wake of a 43% improve in Volvo’s earnings in 2023, a report in its 97-year historical past, the corporate claims.
Each Volvo and Polestar are subsidiaries of China’s Zhejiang Geely Holding group. Below the brand new settlement, Volvo intends to switch a portion of its 48% stake in Polestar to guardian firm Geely, which is able to turn out to be a “vital” new shareholder in Polestar. Geely has promised to offer “full operational and monetary assist to Polestar” going ahead.
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The distinction between Polestar and Volvo is reasonably complicated
Polestar was initially launched as a extra performance-oriented, BEV-only, and unique sibling to Volvo. However with Volvo’s personal EV plans taking off efficiently, and Polestar struggling, the road between the 2 manufacturers has blurred.
It’s value noting that Geely’s 79% stake stays unaffected by this growth.
2023 was a report 12 months for EV gross sales for many manufacturers within the U.S., together with Volvo. The automaker offered 113,419 BEVs in 2023 globally, a 70% improve in comparison with 2022. That determine consists of the 35,000 plug-in automobiles (together with PHEVs) it offered within the U.S., of which 13,609 have been absolutely electrical fashions. EVs represented 16% of its complete international gross sales quantity.
Nonetheless, the story at Polestar has been considerably totally different. It introduced early this week that it was shedding 15% of its international workforce to scale back prices. It additionally struggled to fulfill its supply targets in 2023. Regardless of the setbacks, it mentioned that the rollouts of the Polestar 3 electrical efficiency SUV and the Polestar 4 coupe have been imminent.
“Volvo Vehicles’ and Polestar’s robust operational collaboration throughout R&D, manufacturing, after-sales, and business will proceed to profit each corporations,” Jim Rowan, the president and CEO of Volvo Vehicles AB mentioned. Volvo is bullish on its 2024 outlook as effectively, stating that it expects the next year-over-year progress charge in its retail gross sales in 2024 in comparison with 2023.