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Polestar has successfully secured $950 million in external funding, underlining its robust progress towards its 2025 objectives. This funding, provided by a consortium of 12 leading international banks, including notable names like BNP Paribas and HSBC, signifies a major step forward for the Swedish electric performance car brand. With a current cash balance of approximately USD 770 million as of the end of 2023, this financing is a critical component of Polestar’s strategic development plans.
“Polestar’s achievement in securing funding from a global bank syndicate demonstrates the confidence our partners have in our growth trajectory. This, combined with Geely’s unwavering support and access to cutting-edge technology, solidifies our march towards cash flow positivity by 2025,” stated Thomas Ingenlath, CEO of Polestar.
Daniel Li, CEO of Geely Holding Group and a board member at Polestar, echoed this sentiment. “As a strategic ally and direct shareholder, Geely remains committed to supporting Polestar’s operational and financial needs. Our intention to participate in future financing activities underlines our confidence in Polestar’s potential for global success.”
Enhancing Operational Efficiency
Alongside securing financing, Polestar is implementing a comprehensive efficiency program. This includes a reduction of the workforce by 10 percent since mid-2023, with an additional 15 percent reduction planned for this year. These measures are integral to Polestar’s refined business strategy, aiming for cash flow break-even, an annual production volume exceeding 155,000, and achieving a gross margin in the high teens.
Expanding Product Portfolio
Polestar’s strategy also encompasses the expansion of its product line with two new high-margin SUVs, which are expected to significantly contribute to volume growth and profit margins in the latter half of 2024. The commencement of Polestar 3 production in China and the acceleration of Polestar 5 prototype production are key milestones in this strategy.
The securing of USD 950 million in funding, coupled with a restructured shareholder framework wherein Geely Sweden Holdings becomes the second-largest shareholder and Volvo Cars retains an 18% stake, marks a new chapter in Polestar’s journey. “The fruits of our labor over the past few years are now visible. With improved cost structures, secured financing, and an aggressive product rollout, we are poised for substantial growth and profitability in the near future,” concluded Ingenlath.
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