Volvo no longer wants to invest money in the struggling Polestar

Polestar started out as a convertible Volvo and has been associated with the Swedish brand for almost twenty years. In 2017, the brand went on its own, but Volvo remained the main shareholder with a 48 percent stake. In addition, Polestar was allowed to use Volvo’s concept car as its production model (the Polestar 2) and Volvo continued to invest money in Polestar. But the brand now wants to put an end to that.

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Setting priorities

Volvo shows that Polestar with its new business plan and the introduction of Polestar 3 in Polestar 4 facing a bright future. And so the brand turns off the money tap for his daughter’s brand. Volvo also says that it is doing this to focus on ‘its own evolution’.

With this, Volvo refers to the electrification of its version. Volvo sold 113,419 EVs worldwide last year, a 70 percent increase compared to 2022. Still, there is work to be done, as the brand wants half of the Volvos sold to be EVs by 2025. From 2030, Volvo wants to offer only electric vehicles. This requires significant investment, which means that priorities must be set. And Polestar is no longer one of them.

Stock

It raises the question of what will happen to Volvo’s stake in Polestar. Volvo is considering transferring its shares to Geely – the Chinese parent company of both brands. It has agreed to continue investing, so Polestar need not worry too much. Volvo is not ending the partnership: it wants to continue to support Polestar with production, development, after-sales and commercial activities.