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    Geely holding got rid of part of the shares of Volvo Cars, which greatly frightened investors

    The Chinese holding Geely reduced its stake in the Swedish company Volvo Cars from 82% to 78.7%, wanting to increase the price of the latter, but in the moment the effect was exactly the opposite – Volvo Cars shares fell in price by about 14%.

    The Geely holding bought Volvo Cars from Ford in 2010, today the Swedish company is considered one of its most valuable assets, while the technical ties between Volvo and other Geely-owned brands are becoming stronger: the last two Volvo models – the EX30 subcompact crossover and the EM90 minivan – have been built on the modular SEA platform developed by Geely.

    Global sales of Volvo Cars are now showing positive dynamics: from January to October this year, according to the company itself, 569,019 cars were sold, which is 18% more than in the previous period. The goal for the end of 2025 is to reach a sales level of 1.2 million cars per year, for which, in fact, Volvo is now rapidly updating and expanding its model line.

    It would seem that the Swedish company is doing well, and the Geely holding reduced its share in it slightly, but there was quite a commotion on the stock exchange: on Friday (November 17), Volvo Cars shares fell in price by 14%, which is quite strange given such good reporting. Meanwhile, a chart of the year's dynamics available on the Reuters website shows that Volvo Cars shares have been jumping all year, the previous big decline was in May amid news that the launch of the flagship Volvo EX90 crossover was delayed due to software problems.

    The sale of even a small part of the shares is likely to be perceived by investors as a bad signal and a risk of further reducing Geely's participation in Volvo Cars. The money from the sale of shares went to the development of the entire holding, and not to Volvo Cars, in which Geely had recently invested huge amounts of money. Last summer, Volvo Cars announced the start of construction of a third European plant, it will be located in Slovakia, its cost is estimated at 1.2 billion euros, the design capacity is 250 thousand cars per year, the launch is scheduled for 2026.

    In general, Volvo Cars owes its current fairly prosperous position mainly to the Geely holding; without it or with less attention on its part, the prospects for Volvo Cars seem vague. Let us recall that Volvo Cars wants to completely switch to electric vehicles in 2030, while the Geely holding as a whole is not going to do this and even launched a giant motor joint venture with the Renault Group last summer.

    In addition, Volvo Cars Today there are no image sports models, since this direction is supervised by Polestar, which broke away from Volvo Cars in 2017, which is also owned by Geely. The Polestar brand, with a common technical basis with Volvo, today seems brighter and more promising, while Volvo, in fact, has returned to the “family-retirement” role, which it has diligently abandoned since the mid-90s.

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