Shares
of
Swedish
automaker
Volvo
Car
[VOLCAR
B],
which
is
majority-owned
by
China’s
Geely,
surged
as
much
as
32%
at
Thursday’s
open
and
traded
27%
higher
on
Thursday
afternoon.
In
the
earnings
report,
released
before
regular
trading
opened,
Volvo
reported
a
10%
year-on-year
increase
in
fourth-quarter
net
sales
to
148.1
billion
Swedish
kronor,
bringing
its
full-year
2023
total
to
552.8
billion
kronor.
Adjusted
operating
income
jumped
to
18.38
million
kronor
from
12.17
million
for
the
same
period
in
2022.
Volvo
Cars
is
“evaluating
a
potential
adjustment
of
Volvo
Cars’
shareholding
in
Polestar,
including
a
distribution
of
shares
to
Volvo
Cars
shareholders.
This
may
result
in
Geely
Sweden
Holdings
becoming
a
significant
new
shareholder”,
the
company
wrote
in
its
year-end
report.
Volvo
Cars
further
announced
that
Geely
will
continue
to
provide
full
operational
and
financial
support
to
Polestar
going
forward,
and
as
a
result,
Volvo
Cars
will
no
longer
provide
additional
financing
to
its
part-owned
electric
car
subsidiary.
However,
the
company
will
extend
the
repayment
period
of
the
existing
convertible
loan
by
18
months
to
the
end
of
2028.
Volvo
Cars
holds
a
stake
of
about
44%
in
Polestar,
according
to
LSEG
data,
having
acquired
the
company
in
2015.
The
luxury
electric
vehicle
brand,
also
based
in
Sweden,
has
struggled
since
going
public
in
June
2022,
and
analysts
were
wary
that
it
had
become
a
drag
on
Volvo’s
resources.
Why
Is
Volvo
Ditching
Polestar?
The
most
important
news
of
the
day
was
the
planned
spin-off
of
all,
or
part,
of
Polestar,
analyst
Magnus
Dagel
writes
in
Swedish
daily
Dagens
Industri
“This
is
a
much-needed
jump
for
the
share
price,
as
it
has
performed
very
weakly
recently.
Before
Thursday’s
price
surge,
the
share
price
had
halved
since
the
IPO
in
the
fall
of
2021”,
Dagel
says
and
adds
that
he
thinks
the
best
way
forward
is
to
sell
all
of
Polestar
and
invest
everything
in
Volvo,
where
the
opportunities
are
“actually
quite
promising
in
the
coming
years.”
The
weak
development
of
its
share
price
has
wrongly
led
many
to
believe
that
the
company
is
also
developing
poorly,
Dagel
explains.
“The
earnings
report
showed
that
2023
in
many
ways
was
the
best
year
ever.
Sales
of
709,000
cars
are
the
highest
ever,
as
is
turnover
of
SEK
399
billion,
up
a
strong
21
percent
from
2022.
Volvo
is
even
flagging
for
higher
growth
than
that
in
2024”,
he
writes.
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