Is Polestar in danger of bankruptcy?

Since 2017 it works PolestarVolvo’s old sports division, as one independent brand. For Volvo in Geely – Chinese owner – the idea was to create a business model similar to Tesla: no dealers, but a few Spaces (less than 150 worldwide) and online sales. The Polestar 1 was still a plug-in hybrid, but the Polestar soon became 100 percent electric.

Since its inception, Polestar has performed well, from only 10,000 vehicles in 2020 due to Covid-29 to 29,000 in 2021 and over 50,000 in 2022. However, since then growth has slowed somewhat. it’s stuck and the brand does not enter further, and sales of 53,000 cars in 2023 with a clear decrease at the end of the year. This is far from the original the goal of 80,000 cars in 2023 and 290,000 units expected in 2025. And it cannot be compared to Tesla’s sales (1.81 million vehicles in 2023).

140 million burned

This poor performance has resulted in a loss car 140 million euros in the last quarter of 2023. It is be late of new models (Polestar 3 and 4) of course didn’t help either. Nor the dismissal of 15 percent of the workforce last summer (450 people). And Polestar has made it even harder to… IPO in 2022. Results: stock price has dropped 80 percent, from $90 to $1.5.

In that environment Volvo decided to protect itself by reducing its shares from 48 percent to 18 percent. The park has grown since then. Very good, but the signs remain negative. What must be present and capable customers from Polestar do?

Do you have hope?

Polestar is now trying to reassure. The brand has indicated to HLN that there is a new shareholder structure has been established, with Geely at the helm. Brand also has loan of 877 million euros receive, which may allow to live until 2025. Polestar hope to sell of three times up to 155,000 units per year to break even. The company has big ambitions and its success depends more on whether the public accepts the new Polestar 3 and 4 receives well, two focused crossovers rich people which are often exposed to electric driving. So the outlook seems optimistic, even though the market is in deep recession and price wars are going on in some parts of the world. Can Polestar break, like Tesla has he done so despite the hard times? That is not certain. Investors have always believed in Tesla, which has given the brand an incredible stock market valuation. Polestar still has a long way to go…

Not important anymore?

As HLN correctly writes, the later on from Polestar too insecurity. And it is unlikely that, if things go wrong, owners will no longer be able to use their Polestar or the Polestar charging card will no longer work. public charging stations. Although Polestar is still not in such a bad position. The technology is, after all, with Volvo, which means that there may also be solutions to problems. Furthermore, it remains to be seen which strategy is the owner Geely he spends, because he has enough money. However, we know there will be one at some point logic will appear on electric vehicle brands because now there are so many in the market. To be continued…

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