Volvo Car AB (publ.) successfully placed its second green bond to raise EUR 500 million from a diverse set of global investors. The bond was oversubscribed three-times, despite challenging global market conditions. All proceeds are earmarked for funding and accelerating the company's transformation towards becoming a fully electric carmaker by 2030 and becoming climate-neutral and circular by 2040.

More than two-thirds of the proceeds will fund the research and development of electric powertrains for next-generation pure electric Volvo cars as well as related new platform technology, while the rest will be invested in boosting the company's production capacity of fully electric cars. The EUR 500-million, 6-year fixed rate senior unsecured green bond was issued under Volvo Cars' Euro Medium Term Note program. The bond matures on 31 May 2028, pays a fixed coupon of 4.25%, equivalent to 291 basis points above mid-swap, and will be listed on the Luxembourg Stock Exchange.

The successful placement shows that there is still a demand for sustainable investment opportunities, the company said. Above all, a three-time oversubscription illustrates the strong trust that investors put not only in Volvo Cars, but also in the company's climate plans and electrification strategy.