Polestar has secured a significant financial boost, raising nearly $1 billion in a new loan from a group of banks. This infusion of capital comes at a crucial point for the Swedish electric vehicle (EV) manufacturer after Volvo, one of Polestar’s main backers, announced last month it would cease further funding, transferring the majority of its stake to shareholders, including Geely.
The $950 million loan, facilitated by 12 international banks such as BNP Paribas, Natixis, Standard Chartered, BBVA, HSBC, and SPDB, will help Polestar reach its next development phase. This funding is expected to cover the majority of its financing needs, setting the stage for the company to achieve its targets, including reaching cash flow break-even by 2025 and significantly improving gross profit margins by the end of 2024.
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.
Thomas Ingenlath, Polestar CEO
The company has outlined ambitious plans, including the rollout of its current model program with the Polestar 2, Polestar 3 which just started production, the Polestar 4 later this year, and the introduction of the Polestar 5 in 2025.
This product expansion will be supported by the new financing, which is aimed at bolstering Polestar’s volume growth and enabling the company to hit its target of producing more than 155,000 vehicles annually by 2025.
Geely, the Chinese automotive giant that co-founded Polestar alongside Volvo, has reiterated its commitment to the performance car brand. Despite Volvo’s decision to cut direct funding, Geely says it will continue its support, including retaining its shares and participating in future financing activities.
