January 24, 2019 / 10:51 AM / 22 days ago

Volvo says electric car unit Polestar could list one day

FRANKFURT/STOCKHOLM (Reuters) - Volvo Cars, owned by China’s Geely, could in future seek external investors for its Polestar performance electric car brand and list the unit on the stock market but has no immediate plans to do so, the company said on Thursday.

FILE PHOTO: Volvo Cars U.S. production plant is pictured in Ridgeville, South Carolina, U.S. June 20, 2018. REUTERS/Randall Hill

Germany’s Capital magazine had earlier quoted Volvo Chief Executive Hakan Samuelsson as saying that Polestar could tap financial investors to help stem the costs of developing new electric powertrains as a precursor to listing.

However, a spokesman for the Swedish carmaker said that while Samuelsson had “discussed the benefits of making it possible for external investors to enter Polestar in the future”, he had not confirmed any plans in that regard.

“(There are) no plans and no timeline for this; it was only a discussion around future possibilities,” the spokesman said.

Carmakers are having to strike partnerships and seek alliances to cut the burden and cost of building new electric and autonomous powertrains, even as they grapple with challenges stemming from Washington’s trade war with China and new emission regulations.

Volvo abandoned plans to list for an estimated valuation of between $20 billion (15.34 billion pounds) and $30 billion in September due to trade tensions and an auto industry downturn.

When putting the IPO on ice, Samuelsson had said that Volvo had “other alternatives” to raise finance.

The company and parent Geely each held a 50 percent stake in Polestar since October 2017, when they agreed to jointly invest 5 billion Chinese yuan renminbi (565.22 million pounds) in the brand to fund its initial development of luxury electric cars.

Geely declined to comment on Thursday.

A Polestar spokesman said: “The entire Polestar Management team is focused on developing the Polestar 1 and preparations for the upcoming launch of Polestar 2.”

The marque is looking to roll out three models by 2021 and hit a target of 50,000 to 100,000 cars a year.

It is gearing up to debut the Polestar 2, its first full-battery electric vehicle that it has widely touted as competitor to Tesla’s Model 3, this quarter and also intends to launch production of its first car, the more expensive $155,000 Polestar 1 hybrid, by the middle of the year.

Reporting by Edward Taylor in Frankfurt and Esha Vaish in Stockholm; Editing by Emelia Sithole-Matarise and Keith Weir

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