Volvo could become the next major car manufacturer to go public. Zhejiang Geely Holding Group, the parent company of Volvo Cars, is reportedly considering an initial public offering (IPO) for the Swedish automaker later this year, in a move that would value the company at around $20 billion.
This decision follows Volvo’s choice in February to abandon a full merger with its parent company, Geely. Nevertheless, the two companies maintain a close collaboration, including technology and production facility exchanges, with Geely expected to remain the primary shareholder of Volvo.
Volvo came close to launching an IPO in 2018 but put it on hold due to concerns that stock prices could be affected by the ongoing trade tensions, primarily between the United States and China, but also involving the United States and Europe. At that time, estimates valued Volvo at up to $30 billion.
Geely has played a significant role in transforming Volvo since acquiring the brand from Ford in 2010. Today’s Volvos are comparable to top German vehicles, and the company is expanding with sister brands Lynk & Co. and Polestar, in addition to launching its first electric vehicles.
Volvo is also in the process of introducing a second-generation modular platform for larger vehicles, known as SPA2, which will debut next year with a redesigned XC90. This new platform will support a high level of autonomous driving capability, a technology Volvo is developing through its subsidiary Zenuity.
“We have supported the transformation and growth of Volvo Cars over the past 10 years, enabling the company to become a true premium brand with improved profitability,” said Eric Li, Chairman of Geely. “Looking ahead, Volvo Cars is especially well-positioned for continued growth and to harness the full potential of electrification and the delivery of safe autonomous driving features.”
