Polestar Receives Lifeline With $300 Million in New Financing
Deal Follows Polestar's Announcement of a New Credit Agreement With a Wholly Owned Geely Unit for Term Loan of Up to $600M
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Polestar Automotive Holding UK has secured $300 million in new financing, giving the cash-burning EV maker a fresh lifeline as it contends with heavy losses, shrinking liquidity and mounting pressure from creditors.
The company also announced Dec. 19 that Geely Sweden Holdings has agreed to convert about $300 million of debt owed by Polestar into equity.
“These transactions significantly enhance our liquidity position and help strengthen our balance sheet,” Polestar CEO Michael Lohscheller said in a statement.
Lohscheller is a former president of bankruptbattery-electric and hydrogen fuel cell truck maker Nikola.
Lohscheller
Polestar said the equity investment was split evenly between Banco Bilbao Vizcaya Argentaria and Natixis.
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The deal, which buys Polestar more time, follows its announcement earlier in the week of a new credit agreement with a wholly owned Geely unit for a term loan of up to $600 million. Despite its “asset-light” business model, Polestar has racked up roughly $8 billion in cumulative losses since inception.
The Volvo Car offshoot — controlled largely by Chinese billionaire Li Shufu through Zhejiang Geely Holding Group and his private investment vehicles — has shed almost all of its market value since going public in 2022, with the stock down another 60% this year.
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Since taking over last year, Lohscheller has pushed to restore financial discipline, shifting Polestar to a traditional dealership model while tightening costs.
But tariffs, soft U.S. demand and delays in the company’s volume pipeline continue to weigh on the turnaround. Polestar’s latest quarterly results showed improving volume but widening losses.
Chief Financial Officer Jean-Francois Mady told analysts in November that Polestar could “not rely on the debt from the bank” and would need to raise additional equity.
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