“Polestar intends to use the proceeds from the equity investment for working capital requirements and general corporate purposes,” the automaker said in a Monday (June 16) press release.
The company manufactures its electric performance cars in North America and Asia and offers them in 28 markets across North America, Europe and Asia Pacific, according to the release. It plans to add production in Europe.
Geely Holding Group operates in several sectors, including automotive, where it has stakes in Polestar, Volvo and Lotus, according to the company’s website.
Like many electric vehicle makers, Polestar has needed additional funding amid a softer market and greater competition, Reuters reported Monday.
Volvo cut its holdings in Polestar and ended its financial support for the company last year after analysts criticized the amount of resources it was devoting to the company, the report said.
When Volvo announced that move in February 2024, it said in a press release that it was focusing its resources on its own journey while investing in new technologies and production facilities.
Polestar has been gaining momentum in the electric vehicle market and will use some of the new funding to support its launch of three more vehicle models, including a four-door GT, a roadster and a compact SUV, TFN reported Friday (June 20).
The automaker said in May that it reduced its net loss by 31% in the first quarter and secured or renewed over $900 million worth of financing facilities during the quarter.
Polestar’s sales increased by 76% year over year to reach 12,304 in the first quarter, while its revenue rose 84%, it said in a May press release. The company attributed these gains to growing uptake of new models, higher volumes and a shift in the product mix to higher margin models.
“We continue to make great progress, transforming our commercial operations and taking steps to reduce our cost base,” Polestar CEO Michael Lohschellar said in the release. “We are selling more cars, at improved margins, resulting in revenue growth of 84%, a gross margin that is now positive, at 7%, and a narrowing net loss.”
