Volvo Cars’ initial public offering is a must-see test case for investors’ willingness to small automakers as the industry’s technological transition accelerates.
Reported half-year results on Friday, a private Swedish company, not to be confused with the listed truck giant Volvo AB, said in May that it was working towards an IPO later this year. If Geely Holding, a Chinese company that acquired Volvo from Ford for only $ 1.8 billion in 2010, closes the deal with a sound valuation, it will be a victory for strategic flexibility over pure industrial and financial strength. Let’s do it.
Swedish companies are smaller than their traditional rivals. In the 12 months to June, 773,000 cars were sold. This is compared to, for example, about 2.2 million Mercedes-Benz cars. The German brand announced on Thursday that it will spend at least € 40 billion, or about $ 47 billion, on electric vehicles by 2030. This is the latest in a similar pledge prolongation list. Volvo does not want to participate in the game and remains silent on the issue of total EV investment.
Still, the company is the earliest to embrace the move to EVs, and its migration strategy remains one of the most advanced in the industry.
For example, we take the unusual step of selling the latest all-electric vehicle, the Volvo C40 Recharge, only in the Tesla style of the website, not the dealers. In the United States, where franchise law primarily prohibits direct car sales by manufacturers, the purchasing process has been reinvented so that dealers own the car for a brief moment. This gives Volvo more control over inventory, pricing and customer data. The last point is especially important as the car will become a connected digital device and add-on services such as insurance may be sold.
Volvo Cars Needs Investors to Evaluate Brains More Than Brown
Source link Volvo Cars Needs Investors to Evaluate Brains More Than Brown