Polestar secures one billion in external funding, marking a significant leap towards the expansion of its electric vehicle (EV) lineup. The major milestone was announced by Polestar CEO Thomas Ingenlath in a short video posted on the company’s social media platform X (formerly Twitter).
A major milestone for Polestar and our development: securing one billion dollars in external funding, providing us with the resources to complete the next phase of our development, where we grow from being a one-car-company to a line-up of #Polestar2, 3, 4 and 5.
With secured… pic.twitter.com/Nd1LEkKrWt
— Polestar (@PolestarCars) February 28, 2024
Banks involved in the loan include BNP Paribas, Natixis, Standard Chartered, BBVA, HSBC, and SPDB. This funding is part of Polestar’s strategy to become financially independent, filling the funding void left by Volvo Cars’ decision to halt its financial support.
Geely CEO and Polestar board member Daniel Li stated Geely’s continued support for Polestar. He confirmed Geely’s intention to retain its shares and participate in future financing activities if needed. Polestar will also have access to Geely’s technologies and engineering expertise to achieve its growth targets.
A Timely Financial Boost
The loan arrangement comes at a crucial time for Polestar, which has been aggressively seeking external funding to enhance its market presence and expand its production capabilities. The influx of nearly $1 Billion is expected to significantly impact the company’s financial health, with Polestar projecting an improvement in profit margins by 2024.
“This marks a new phase in Polestar’s business,” says Ingenlath. “The efforts of recent years are paying off: We improved our cost basis, secured financing and are ramping up our product offensive. Both SUVs now sharpen the brand, target one of the fastest growing segments in the industry and position us for strong volume growth and profit margin progression from the second half of 2024,” he added.
Focusing on New Models
Thomas Ingenlath emphasized the importance of this funding. It allows Polestar to focus on launching its upcoming car models. The company plans to release Polestar 2,3, and 4 this year, with Polestar 5 set for 2025.
Polestar expects volume growth this year, supporting its goal to produce over 155,000 vehicles annually by 2025. The company anticipates that volume and margin progression will be more substantial in the second half of 2024. This is when the Polestar 3 and 4 SUV models are expected to reach full production and global distribution.
As Polestar secures one billion in external funding, it provides the financial stability needed to continue its growth in the competitive EV market. With new models on the horizon and the support of major banks and Geely, Polestar is well-positioned to achieve its targets.
Image Source: Twitter (@PiQSuite)
