Volvo Car announced on Thursday that it is considering reducing its shareholding in Polestar, the electric-car maker. The company also stated that it will no longer provide further funding to Polestar. Volvo Car, along with China's Geely, founded Polestar, which recently completed a special-purpose acquisition company merger and listed on Nasdaq.
Over the years, Volvo Car has provided Polestar with loans totaling $1 billion. However, as Volvo Car moves into the next phase of its transformation, it is focusing on developing its own company and allocating resources accordingly. In light of this, Volvo Car is evaluating a potential adjustment to its shareholding in Polestar, which may involve distributing shares to Volvo Car's shareholders. As a result, Geely Sweden Holdings could become a significant new shareholder. Geely is currently Volvo Car's major shareholder.
In the fourth quarter of the previous year, Volvo Car saw a rise in revenue driven by higher volumes. The company expects the growth rate in retail sales to increase further this year, assuming there are no major disruptions.
Net profit attributable to shareholders also increased to 3.11 billion Swedish kronor ($299.2 million) compared to SEK2.46 billion the previous year. Revenue experienced a 4% increase, reaching SEK109.44 billion. Analysts had projected a net profit of SEK4 billion on revenue of SEK108.35 billion, according to FactSet.
Volvo Car remains committed to achieving an Ebit margin above 8% for 2026 based on expected revenues between SEK550 billion-SEK600 billion. Chief Executive Jim Rowan emphasized that this would result in a revenue compound annual growth rate of 11%-15% from 2023 to 2026.
Looking ahead, Volvo aims for a higher year-over-year growth rate in total retail deliveries for 2024 compared to 2023.