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Geely holding Group will become the new shareholder of Polar Star!

2024-04-24 Update From: AutoBeta NAV: AutoBeta > News >

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On Feb. 1, according to Interface News, Volvo said it was evaluating its stake adjustment in Polar Motor and may allocate its shares to other shareholders. Volvo parent Geely Holdings Group will become the new shareholder of Polar. It is understood that Volvo currently holds a 48% stake in Polar Motor. In addition, Volvo will no longer provide funds to Polaris and extend the repayment period of existing convertible loans by 18 months to the end of 2028.

Reported that on the same day, Geely Holdings issued a statement supporting Volvo cars to make potential adjustments to its shares in Polaris. If the equity adjustment is completed, Geely Sweden Holdings of the company will become an important new shareholder of Polar. Geely Holdings will continue to provide comprehensive operational and financial support for the Star brand, and such support does not need to reduce Geely Holdings' stake in Volvo.

Polar Star was originally the electrified high-performance R & D department acquired by Volvo. In 2017, Volvo proposed a full electrification transformation, and then announced the formation of a joint venture brand with Geely in October of the same year-Polar Automobile Polestar, headquartered in Gothenburg, Sweden. Since then, Polar has become an independent high-end electric car brand jointly launched by Geely and Volvo. At the same time, a new brand of new energy vehicles is added to Geely's new energy product series. In June 2022, Polar was listed on the NASDAQ Stock Exchange in the United States. Polar China is wholly owned by Polar Motors, and its main business includes factory manufacturing, R & D and marketing.

Polar Star released four models in 2017, of which the first one is a two-door sports car with a price of 1.45 million. The car was released in October 2017, but it took two years to officially launch. After listing, the performance is also very mediocre, with only 24 cars sold in 2020, but the industry believes that the purpose of Polar 1 is not to sell, but to create a high-end brand image. On February 27th, Polar released its second product, Polar 2, which is the first pure electric car of Polar Star, based on Volvo CMA architecture, with a price range of 25.78 to 338000 yuan, mainly comparable to Tesla Model3, but it also took nearly a year and a half to officially deliver.

As a luxury electric car brand jointly built by Geely and Volvo, the models currently on sale include Polar 1, 2 and 3, which mainly compete with Tesla in the car market. But unlike other Geely brands, Polar Motor focuses on overseas markets, the Chinese market is not very loud, and it has hardly announced its sales performance in the Chinese market. It is reported that the sales of Star cars in China were 2048 in 2021, 1717 in 2022 and 1100 in 2023, down 34% from the same period last year, a far cry from the mainstream car companies in the market.

According to the plan, Polar originally set an annual global sales target of 80,000 vehicles in 2023, but taking into account the delay in mass production of new cars and other reasons, Polar has announced that it will reduce global sales this year to between 60,000 and 70,000 vehicles, a reduction of as much as 25%. As a reference, the data show that the global delivery volume of Star Motors in 2022 was 51491, an increase of 80% over the same period last year, setting an all-time high.

On January 26 this year, Star Motors said that in a "challenging market environment", the company plans to cut about 450 jobs worldwide, accounting for about 15% of its total employment. the main purpose of the layoffs is to accelerate the improvement of profit margins and reduce the company's total capital needs, so as to achieve cash flow balance by 2025. It is worth mentioning that in May 2023, Star Motors also announced 10% layoffs worldwide and froze recruitment; in November of the same year, Star Motors announced a business strengthening plan, the goal is to accelerate profit margin improvement and reduce the company's total capital requirements, and achieve cash flow balance by 2025.

The industry believes that the sales performance of Polaris in China is generally related to the fierce competition for electric cars in the Chinese market. As a luxury electric car brand jointly built by Geely and Volvo, there is still a lot of room for improvement in the development of the Chinese market. At the same time, it will be difficult for Polaris to make a profit by 2025.

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