Volvo Cars and its owner Geely said on Monday they had postponed plans to float shares in the Swedish carmaker, blaming trade tensions and a downturn in automotive stocks.
Volvo said plans for a listing in Stockholm had been delayed indefinitely, a move first reported by the Financial Times.
The postponement came as Britain's Aston Martin vowed to press ahead with its own flotation.
"We've come to the conclusion that the timing is not optimal for an IPO right now," Volvo Chief Executive Hakan Samuelsson told Reuters in a telephone interview.
Volvo and its Chinese parent had been discussing an initial public offering to value the carmaker at between $16 billion and $30 billion, sources have previously said. The company said on Monday a listing was still possible in the future.
But Samuelsson said IPO prospects had dimmed with the business cycle, amid a broad-based decline in automotive shares that has dragged the Stoxx 600 Autos & Parts index 15 percent lower so far this year.
Even before the recent sector sell-off, however, some observers were dubious about the $30 billion upper end of Volvo's target valuation.
"We had expressed our reservations concerning lofty valuation ambitions before," Evercore ISI analyst Arndt Ellinghorst said on Monday. "Trade wars are just one red flag."
Washington's escalating trade spat with Beijing and tensions with Europe have rattled automotive investors, hitting share prices and adding volatility to market outlooks.
Volvo is less exposed than its German premium rivals to U.S.-China tariffs, however, and has said it will juggle production of its XC60 SUV to reduce their impact.
Geely, which paid Ford Motor Co $1.8 billion for Volvo in 2010, also has stakes in Mercedes-Benz parent Daimler, truckmaker AB Volvo and Lotus.
Geely and its boss Li Shufu concluded that Volvo should make deeper inroads into the Chinese market before listing, a person familiar with the group's thinking told Reuters.
Volvo delivered 61,480 cars in China in the first half, a fraction of BMW's or Audi's sales.
Volvo, which is developing Polestar as an electrified performance brand and owns a stake in Geely stablemate Lynk&Co, has "other alternatives" to raise finance in future, CEO Samuelsson said on Monday.
The IPO postponement reflects bigger concerns about "price development after a potential IPO" rather than about the initial valuation, he maintained - citing sensitivities over the prevalence of public pension funds among Swedish institutional investors likely to participate.
Amid growing market uncertainties, the Volvo CEO said, "what made me nervous especially was leaving headroom for investors."
Samuelsson said Aston Martin, as a pure luxury play, was "more like Ferrari" - whose widely envied listing came close to late boss Sergio Marchionne's 10-billion-euro target valuation. Like Volvo, Aston Martin was once owned by Ford.
"I wish them luck with their IPO," Samuelsson said.