Swedish automaker Volvo Cars Group AB on Monday said that it plans to raise at least 25 billion kroner (US$2.9 billion) by selling shares to fund its electric vehicle (EV) transformation strategy.
Volvo Cars and its parent company, Chinese automaker Zhejiang Geely Holding Group Co (浙江吉利控股), have applied to hold an initial public offering (IPO) on the NASDAQ Stockholm, with shares expected to start trading before the end of the year.
The money raised from the IPO is to help fund Volvo’s lofty ambitions.
Photo: AFP
The company aims to nearly double sales by 2025 to 1.2 million vehicles, half of which are to be battery electric vehicles, and wants its entire lineup to be all electric by 2030.
“We’re going to be the fastest in the business to transform to electrification — 2030 no more combustion cars. And that’s just one part,” Volvo Cars chief executive officer Hakan Samuelsson said in an interview.
Volvo Cars’ plans also include selling more directly to customers and it aims to have half of all sales come from online channels by the middle of this decade.
“All of that costs a lot of money,” Samuelsson said. “So that’s why we are now doing a primary issue of new shares to secure equity for that transformation next year.”
Most of Volvo Cars’ current lineup is made up of plug-in hybrid and so-called mild-hybrid models. Battery electric vehicles account for only a small fraction of the total sold.
Volvo is based in Goteborg, Sweden, but has been owned since 2010 by Geely, one of China’s biggest independent automakers, which bought it from Ford Motor Co for about US$1.8 billion.
The company is moving ahead with the share sale even as a shortage of semiconductors has crimped global auto production.
The shortages are likely to persist to at least the end of the year, Volvo Cars chief financial officer Bjorn Annwall said.
However, because the crunch is being felt across the vehicle industry, automakers can get away with selling pricier models or offering fewer rebates for fatter profit margins, which more than makes up for lower sales.
“From a financial perspective, this shortage of semiconductors is not such a big issue,” Annwall said. “Of course, some customers have to wait longer than we’d like to get the cars delivered. And so it’s a problem, but it’s a problem we have now learned to live within and we don’t see an improvement extremely short term.”
Volvo’s sales tumbled last month, falling 30 percent to 47,223 from the year before, monthly sales figures released on Monday showed.
Annwall said the problem was less to do with chip supplies and more because of COVID-19 lockdowns in Southeast Asia that temporarily shut its suppliers’ factories, leading to general component shortages.
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
ADVERSARIES: The new list includes 11 entities in China and one in Taiwan, which is a local branch of Chinese cloud computing firm Inspur Group The US added dozens of entities to a trade blacklist on Tuesday, the US Department of Commerce said, in part to disrupt Beijing’s artificial intelligence (AI) and advanced computing capabilities. The action affects 80 entities from countries including China, the United Arab Emirates and Iran, with the commerce department citing their “activities contrary to US national security and foreign policy.” Those added to the “entity list” are restricted from obtaining US items and technologies without government authorization. “We will not allow adversaries to exploit American technology to bolster their own militaries and threaten American lives,” US Secretary of Commerce Howard Lutnick said. The entities
Minister of Finance Chuang Tsui-yun (莊翠雲) yesterday told lawmakers that she “would not speculate,” but a “response plan” has been prepared in case Taiwan is targeted by US President Donald Trump’s reciprocal tariffs, which are to be announced on Wednesday next week. The Trump administration, including US Secretary of the Treasury Scott Bessent, has said that much of the proposed reciprocal tariffs would focus on the 15 countries that have the highest trade surpluses with the US. Bessent has referred to those countries as the “dirty 15,” but has not named them. Last year, Taiwan’s US$73.9 billion trade surplus with the US
Prices of gasoline and diesel products at domestic gas stations are to fall NT$0.2 and NT$0.1 per liter respectively this week, even though international crude oil prices rose last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices continued rising last week, as the US Energy Information Administration reported a larger-than-expected drop in US commercial crude oil inventories, CPC said in a statement. Based on the company’s floating oil price formula, the cost of crude oil rose 2.38 percent last week from a week earlier, it said. News that US President Donald Trump plans a “secondary
RSS