Volvo Car shares surged up to 10% on Monday after the Swedish automaker secured specific authorization from US regulators to import and sell vehicles in the American market. The stock climbed 6.7% to 24.71 Swedish kronor, reaching a three-month high, though it remains down nearly 20% year-to-date.

The approval resolves months of uncertainty stemming from President Biden's administration rules targeting China-linked vehicle imports, which take effect for 2027 models. Volvo's Chinese ownership through Geely Automobile Holdings had raised questions about potential market restrictions. Geely controls 78.87% of Volvo Cars via founder Li Shufu.

Investors welcomed the clarity, as Geely's majority stake threatened to complicate Volvo's US expansion plans. The company has been negotiating with regulators since the new national security rules were introduced, seeking to maintain access to one of the world's largest automotive markets.

Despite Monday's rally, Volvo shares trade well below their annual highs, reflecting ongoing skepticism about Chinese-owned assets in Western markets. The authorization provides a pathway forward, but geopolitical tensions around auto sector investments remain elevated.