Polestar Gets $1.6 Billion Lifeline from Volvo Cars
Volvo Cars is providing an $800 million, 18-month term loan to its electrified performance spinoff brand, Polestar. The loan comes with an equity conversion option for Volvo Cars, and matches a second pile of cash made up of direct and indirect financial and liquidity support from Polestar’s other major shareholder, PSD Investment, to total just over $1.6 billion.
That combined cash raise means that Polestar now has enough of a “runway” to survive until customer deliveries of the recently revealed Polestar 3 SUV are well underway and the brand is reaping the benefits of a more diversified product lineup.
“We welcome the continued support from our major shareholders at a time when the capital markets are volatile and unpredictable,” says Polestar CEO, Thomas Ingenlath. “With sufficient funds through 2023, we remain 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. We are making strong progress on our ambitious plans to launch three more cars by 2026.”
The Volvo brass, too, seem upbeat about the deal. “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, Volvo Cars. He added that, “(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.”
What do you guys think — is Polestar’s popularity set to explode when the new Polestar 3 orders start to roll in, or is the Polestar brand too niche to make it into the mainstream? Check out the 3’s official launch video, originally published last month, and let us know what you think of the brand’s future prospects in the comments.
Polestar 3 World Premier
Source | Images: Volvo Cars.
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