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Volvo to stop funding Polestar, sees stock rise dramatically

STOCKHOLM — Volvo Cars said on Thursday it would stop funding Polestar Automotive Holding and was handing responsibility for the struggling luxury car brand over to Volvo's top shareholder China's Geely Holding. The announcement sent the Swedish automaker's stock up more than 30% at market open. The heavy involvement by Swedish-listed Volvo Cars in Polestar, where it owns around 48% of the shares, has been criticised by analysts who see the stake as a drag on Volvo's resources. Like other new EV brands and startups, Polestar has struggled to make headway, particularly since Tesla started a price war last year. The automaker said earlier this month that it had missed its already-reduced delivery targets for 2023. Polestar's shares are down just over 83% since it went public in June 2022 via a merger with a special purpose acquisition company, or SPAC. Volvo Cars said it has considered handing Polestar shares over to Volvo's shareholders, which would make Geely a big direct owner in the brand. Shares in Volvo were up 20% at 0814 GMT, after they soared 32% at market open. Geely in a separate statement welcomed Volvo's decision to focus its resources on its own development. "Geely Holding will continue to provide full operational and financial support to the independent exclusive (Polestar) brand going forward," the Chinese group said. "This support will not require a reduction of Geely Holding shareholding in Volvo Cars," it added. However, the broker Bernstein said it saw a distinct possibility that the Geely ecosystem could sell down its shares in Volvo. Polestar last week said it planned to cut around 450 jobs globally, or about 15% of its workforce, amid "challenging market conditions". It also said in November that it would try to reduce its reliance on external help, publishing a revised business plan, which included getting additional loans from Volvo and Geely. The news could raise questions about the viability of Polestar, which aims to become cash flow break-even in 2025. Some analysts have said it could make more sense to fold Polestar company into Geely. Volvo Cars meanwhile reported a bigger than expected rise in fourth-quarter operating earnings on Thursday, with operating income excluding joint ventures and associates rising to 6.7 billion Swedish crowns ($643.83 million) from a year-earlier 3.9 billion. Analysts polled by LSEG had expected adjusted earnings before tax and interest (EBIT) of 6.5 billion.

IIHS says these are the safest cars of 2013

The Insurance Institute for Highway Safety (IIHS) has revealed its annual list of Top Safety Picks, an award that highlights automobiles it says offer "superior crash protection." A new and still more significant award, the Top Safety Pick+ honor, is given to those vehicles that earn good ratings for occupant protection in four out of five areas of measure. And while some 117 vehicles were given the TSP seal of approval for 2013, just 13 passed muster for TSP+.
To be fair, IIHS only evaluated 29 vehicles with its new testing procedures for TSP+ (we'd expect that the number of qualified cars will rise substantially for 2014). Luxury and Near Luxury midsize cars were the first groups evaluated, followed by midsizers in the Moderately Priced Cars category - unsurprisingly, it's only midsize cars that you'll find among the class this year.
Only two luxury sedans made the list of 13 for 2013: the Acura TL and Volvo S60. The other 11 cars on the list included entries from domestic, Japanese and German car makers: Dodge Avenger, Chrysler 200, Ford Fusion, Honda Accord (sedan and coupe), Kia Optima (but not its close kin, the Hyundai Sonata, strangely), Nissan Altima, Subaru Legacy and Outback, Suzuki Kizashi and the Volkswagen Passat all made the grade.

Volvo S60 Polestar concept plays in the snow with Mercedes C63 AMG

Chris Harris took to a snowy stretch of tarmac to get a fingertips-on-the-wheel feel of the Volvo S60 Polestar concept. Harris says the turbocharged sedan with 508 horsepower and 424 pound-feet of torque - and a manual transmission - is "a study to see if Volvo can get back into the fast-car market." The Polestar S60 concept, one of which was already purchased for $300,000 by a private buyer, is still making the publicity rounds because even Volvo's Chinese owners realize that, as Harris says, "Volvo sold more cars because it made fast cars" like the old 850 T5 Wagon that stormed the British Touring Car Championship in the 1990s.
For reference, Harris compares the blue wonder to the Mercedes-Benz C63 AMG and its 487 hp and 442 lb-ft. The question is, were Volvo to get the price of a production version of the S60 Polestar to climb way down from its 200,000-pound sticker, could it be worthy competition to the established giants?
You can watch Harris divine the answer via a lot of drifting through the snow and a drag race in the video below.