Polestar secures USD 1 billion external funding; business outlook confirmed

Polestar Automotive Holding UK PLC (Nasdaq: PSNY), the Swedish electric performance car brand, announces that it has secured USD 950 million in external funding. The company is making strong progress on its strengthened business plan and achieving its 2025 targets.

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Polestar lineup including Polestar 2, Polestar 3, Polestar 4, Polestar 5. (Photo: Polestar)

The financing is being provided by 12 leading international banks including BNP Paribas, Natixis, Standard Chartered, BBVA, HSBC and SPDB, in the form of a three-year loan facility. It provides Polestar with the funds it requires to finance the next stage of its development and covers a large majority of its estimated financing needs. Cash on the balance sheet as at 31 December 2023 was approximately USD 770 million.

Thomas Ingenlath, Polestar CEO, says: “Securing funding from a syndicate of global banks reflects our partners’ support for Polestar’s growth course. Together with Geely’s full financial support and access to innovative technology and engineering expertise, we have reinforced our path towards cash flow break-even targeted in 2025.”

Daniel Li, Geely Holding Group CEO and Polestar Board Member, says: “As a strategic partner and direct shareholder in Polestar, Geely will continue to provide full operational and financial support to the iconic performance car brand going forward. We will retain our shares in Polestar and intend to participate in future financing activities when required. Polestar will have full access to technologies and engineering expertise from Geely Holding to realise its global growth targets.”

Delivering on our strengthened business plan

The financing that has now been agreed will be accompanied by a comprehensive efficiency program from Polestar. Among other measures, 10 percent of jobs have been cut since mid-2023, with a further 15 percent to follow this year.

Polestar has thus made significant progress on its strengthened business plan and 2025 targets: achieving cash flow break-even, annual volume of over 155,000 and a gross margin in the high teens.

At the same time, Polestar was able to expand its model range with two high-margin SUVs. The Polestar 4 sales are accelerating around the world, Polestar 3 has now started production in China and has also successfully completed test production runs in South Carolina, USA. Prototype production of Polestar 5, a progressive performance GT, will also accelerate in 2024.