The electric car manufacturer Polestar has received a total of 1.6 billion US dollars in fresh capital from its two main shareholders. This secures the financing for the near future – including the production start-up of the Polestar 3.
Volvo Cars is providing a loan of $800 million with an 18-month term and a share conversion option. Another $800 million is coming from the other major shareholder, PSD Investment. PSD Investment is owned by Eric Li, chairman of both Volvo Cars and parent company Geely.
Polestar CEO Thomas Ingenlath says it has sufficient funds until 2023 and remains “laser focused on business execution”. “We have around 70,000 cars on the road today, and are on track to reach our goal of delivering 50,000 cars to customers in 2022,” the CEO added. “We are making strong progress on our ambitious plans to launch three more cars by 2026.”
Polestar is currently in a period of high financial need. While the series production of the Polestar 2 continues, the company is preparing for the production ramp-up of the Polestar 3 in two plants simultaneously. The electric SUV, which was unveiled in October, is scheduled to roll off the production line in Chengdu, China, from mid-2023, followed by a second production run in 2024 at Volvo’s Ridgeville plant in the US state of South Carolina. With a base price of 89,900 euros, the Polestar 3 is also priced well above the Polestar 2.
Volvo Cars’ share in Polestar, however, remains just under 50 per cent. In the current announcement, the Swedish company states that it holds 48.3 per cent of Polestar. Last year, the figure was temporarily as high as 49.5 per cent.
“Polestar is our affiliate brand and an important business partner, as it plays a key role in our strategic direction to become fully electric by 2030 and shape the future of mobility,” said Johan Ekdahl, chief financial officer at Volvo Cars. “The financial support provided by us along with Polestar’s other main owner will ensure Polestar remains steadfast on further delivering on its ambitions as a performance EV car brand.”