Swedish carmaker Volvo, owned by China's Zhejiang Geely Holding Group, on Monday set the price for its initial public offering at 53 Swedish kronor ($6.18) each share, the lower end of its target range of up to 68 kronor.

Volvo said its shares are set to begin trading on the Nasdaq Stockholm exchange in Sweden on Friday, Oct 29.

The offering would value Volvo at just over $18 billion, much less than the $23 billion valuation that the company had hoped to achieve. In a failed attempt to float in 2018, it wished for a valuation of $30 billion.

The lower pricing illustrates how traditional carmakers with ambitious electrification plans continue to struggle to achieve the valuations of such electric carmakers as Tesla as well as China's trio of Nio, Xpeng and Li Auto.

Volvo Cars seeks to sell only fully electric vehicles by the end of this decade and to build a battery plant in Europe. The company plans to use the IPO funds to add car-producing capacity and double annual sales to 1.2 million vehicles by 2025.

Potential new investors refused to value Volvo's business using the same math as used for new EV makers, saying Volvo's transformation strategy was bold but still unproven, according to the Wall Street Journal.

Instead, they indicated to Volvo that they were willing to value the company based on the lower multiples that traditional carmakers attract, one person familiar with the discussions said.

Volvo CEO Hakan Samuelsson denied that the lower pricing suggested the company had run into difficulties selling the offering to investors, saying the company had considered a range of factors before paring back its IPO.

"(We are) of course listening to the market," he said. "We need to really secure our transformation. We need to secure free float liquidity in the share, but it's also important to leave a possibility for the new shareholders to have a good value development."

While the company will raise less money than hoped, Samuelsson said the proceeds would still be sufficient to secure financing for Volvo's transition to a fully electric auto maker over the next few years.

China's Geely bought Volvo for $1.8 billion in 2010 from Ford, the United States' second largest carmaker.

Volvo's pricing values Geely's post-IPO stake of 82 percent at around $15 billion, making the investment as one of the most profitable ones in the global auto industry.