EV maker Polestar to see 40% drop in Q1 shipments -As of April 11, 2024 at 1:00 p.m.

Polestar saw shipments drop 40% in the first quarter, the Swedish electric vehicle (EV) maker said Thursday.

As automakers and suppliers bet on future demand for electric vehicles, sales growth has slowed as investment in capacity and technology development outstrips demand, increasing pressure on companies to cut costs.

Polestar said it delivered 7,200 vehicles in the first quarter, down 40% from 12,076 a year earlier.

Increased shipments of two luxury SUVs, the Polestar 3 and Polestar 4, will contribute to earnings in the second half of the year, CEO Thomas Ingenlath said in a statement.

“These two vehicles will be the basis for strong sales and volume growth in the second half of the year and support our 2025 goals,” said Ingenlath.

The company plans to deliver 155,000 to 165,000 vehicles in 2025.

Polestar said it delivered 1,200 examples of the Polestar 4 SUV coupe in the first quarter in China, the first country to receive the car by the end of 2023.

Global deliveries of the Polestar 3 are expected to begin in the second quarter of 2024, while the Polestar 4 is expected to reach its first customers in Europe and Australia in August, and deliveries in the US are expected later this year.

Investor enthusiasm for electric car makers has waned as sales growth has slowed and financial losses have mounted, making life difficult for startups like Polestar.

Backer Volvo Cars said in February it would stop further financing Polestar, which is struggling to meet its targets, and hand over most of its shares to its shareholders such as Geely.

The company will report its deferred fourth quarter results on April 30 and first quarter results on May 23.