Volvo’s electric car offshoot Polestar is growing from strength to strength, and for its next part of its expansion, the company is in discussions with investors to raise at least US$500 million (RM2.08 billion), reports Bloomberg. The news comes as sales of environmentally-friendly vehicles are said to be skyrocketing in Europe and recovering in China as the market continues to shift.

According to confidential sources, Polestar is aiming for a brand valuation of around US$6 billion (RM25 billion), although it has yet to finalise a round of funding and may still change the terms. Last year, Volvo CEO Hakan Samuelsson said the carmaker wanted to rival Nio and Tesla in terms of valuation.

Polestar has big plans for the near future. In March, its first all-electric model, the Polestar 2 sedan, began rolling out of a new plant in Luqiao, China. Then in September, it confirmed that it would put the striking Precept concept into production. An SUV model, the Polestar 3, is also reportedly on the cards.

And that’s just the start. Parent company Geely has recently said that it was earmarking a third factory in Chongqing for building Polestar EVs, after Luqiao and the Chengdu facility that builds the Polestar 1. The brand is also expecting to offer larger and sportier models in the future. Its global presence is growing, with 23 showrooms in nine countries and plans to grow this number to 45 by the end of the year.

But it has hit a snag last month, having issued two separate recalls for the Polestar 2. The first, involving a faulty inverter, affected some 4,586 vehicles, while the second recall for a high-voltage coolant heater will require 3,150 units to be brought in.