Volvo buys back shares in Polestar

Volvo has announced it has acquired more shares in its electric performance off-shoot Polestar – increasing its stake back up to almost 50 per cent.

The new investment means the parent company now owns 49.5 per cent in the premium electric vehicle company.

Until earlier this year, Volvo controlled half of Polestar’s shares, but due to a “private placement” lost a large stake in the company which it is only now regaining.

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2022 Polestar 2

Volvo is acquiring its additional portion from PSD Investment – the private investment company of Eric Li, chairman of both Volvo Cars and its parent Zhejiang Geely Holding Group. PSD Investment will remain the second largest shareholder in Polestar.

Despite branching off from Volvo in 2017, Polestar still utilises many of the manufacturing capabilities of the larger manufacturer – though the former says it has no further plans to up its shares in the latter.

The Polestar 3, which is based on Volvo’s next generation electric architecture, will be built at the parent company’s plant in Ridgeville, South Carolina next year, and by mid-decade it expects to be producing models in Europe too.

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Polestar 3 teaser

It marks the first time since the acquisition of Polestar by Geely that the specialist vehicles will be made outside of China – the Polestar 1 and 2 being assembled at factories in the country since 2017.

Polestar became a dedicated EV brand in 2019 after the release of the Polestar 2.

The Polestar 2 electric vehicle – a coupe-like five-door liftback with a raised SUV stance – will make its Australian debut just before this year is out. The Polestar 1 never made it to our shores.

Polestar’s Australian launch will come roughly one year after it launched in the US, where customer deliveries of the Polestar 2 began in December 2020 – a few months later than intended, thanks to Covid-19.

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The Polestar Precept concept vehicle

When it arrives, Australian buyers will be directed primarily to the Polestar website to initiate the sales and test-drive experience, although physical ‘Polestar Spaces’ will also be established – and the entire operation will run separately to the Volvo business.

“Polestar sees considerable potential in the Australian market, which is why it will be one of the first markets to launch as part of the company’s Asia Pacific expansion,” said Polestar Australia boss Samantha Johnson at an event in May.

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The Polestar 1 was never sold Down Under

A Precept concept vehicle, revealed in February 2020, has also been confirmed for future production, with a new video series offering fans a look behind the scenes at how it is conceived and crafted.

Australia has been instrumental in the rise of the Polestar brand. In 2010 the tuning house released a blue Polestar-badged version of the C30 small hatchback to gauge interest in a performance-honed Volvo, with Australia later picked as the first test market for the 2015 introduction of the Volvo S60 sedan and V60 Polestar wagon, a $100,000 hardcore version of the S60 T6 and V60 T6 which started with a tuned turbo-six before adopting a high-boost turbo 2.0-litre four in 2017.