Polestar expects delayed profitability as demand for electric vehicles weakens, competition hurts By Reuters
By Akash Sriram and Marie Mannes
(Reuters) – Polestar’s chief executive said on Thursday it would take longer for the Swedish electric vehicle maker to become profitable after the company reported it sold fewer cars in 2024 than it forecast, sending the company’s U.S.-listed shares lower for about 9% in advance.
The company, backed by China’s Geely, has struggled to grow its business amid weakening demand for electric vehicles and stiff competition from legacy manufacturers.
Over the past year, Polestar (NASDAQ:
Shortly after assuming his post in October, Lohscheller launched a review of Polestar’s operations.
The company announced the results of that review on Thursday, saying it expects positive free cash flow after the investment in 2027, much later than its previous forecast of late 2025.
Polestar previously expected flat revenue for 2024, but now expects a mid-year percentage decline and forecasts a negative gross margin. It is expected to announce fourth-quarter results on March 6.
The company said Thursday that it secured more than $800 million in 12-month term loans secured by several banks last month, and that some of those funds will be used to repay old loans.
The new financing will increase the company’s current debt to about $4.4 billion, it said.
Polestar is also working to secure an additional 12-month credit facility of $400 million that is expected to be available to the company later this month.
THE WAY FORWARD
Polestar’s ambitious market expansion has also been delayed. The company will begin sales in France this year, instead of an earlier plan to enter seven countries in 2025.
Those expansion plans have been pushed back to 2026 and beyond.
The electric vehicle maker’s updated business plan projects overall growth of between 30% and 35% over the next three years, with positive adjusted underlying profit expected this year.
Polestar has worked to avoid heavy tariffs imposed on cars made in China by moving some production out of the country.
While it currently makes cars in both the US and China, it is on track to build its Polestar 4 in South Korea in the second half of 2025. The company said Thursday it expects its Polestar 7 compact SUV to be built in Europe.
Following the launch of the Polestar 7, the company said it would switch to a single-vehicle platform to streamline its operations to reduce capital investment and development time.
Polestar was spun off from Sweden’s Volvo (OTC:) Cars, which stopped funding last year. The electric vehicle maker is now largely owned by Chinese auto conglomerate Geely.
