Volvo Cars' share price has fallen by as much as 75 percent in the past three years. And now Geely, which owns 78 percent of the car brand, wants to sell out.
According to information from Sveriges Radio, Geely, which owns 78 percent of the shares in Volvo Cars, wishes to sell a larger share of the Swedish car manufacturer.
The Chinese car group has had control of the former Swedish brand since its purchase from Ford in 2008. But the high ownership stake may have negatively affected the stock market's interest. Geely's plans for a potential sale also come after a significant decline in Volvo Cars' share price.
The share price for Volvo Cars has fallen by 75 percent in the last three years, and this year alone the price has experienced a drop of 27 percent.
This has happened even though Volvo has managed to increase its market shares. According to market analysts, one of the things that devalues the share is precisely the Chinese. Geely's ownership is simply driving other investors away.
– Something must be done, says an unnamed source to Sveriges Radio .
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It can be interpreted as a need to sideline the Chinese in order to increase the rest of the market's confidence in and interest in Volvo Cars' shares.
In addition, there is concern that Volvo Cars' close relationship with China poses a real risk to sales. Especially in the US. Blue. because President Joe Biden has proposed a law that de facto bans Chinese cars in the country as early as 2028. Read more about it here.
If Geely sells out of Volvo now, it is at a time when the value of the car brand is at its lowest level in recent times.
The share price indicates a market value of around 72 billion Swedish kroner, corresponding to 46 billion kroner. Geely did not wish to comment on the information from Sveriges Radio.
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