Summary
- CEO says Polestar accelerating cost-cutting, efficiency measures
- Polestar secures new funding
(Reuters) – Sweden’s Polestar reported a bigger first-quarter loss on Thursday, as pricing pressure and U.S. tariffs offset stronger sales volumes.
Shares of the company fell 4.3% in premarket trading.
Polestar, majority owned by China’s Geely Holding (GEELY.UL), has rolled out discounts in Europe to attract cautious buyers as it navigates U.S. tariffs that have compressed margins and increased manufacturing costs.
Despite a Europe-focused strategy driving a 7% sales rise during the January-March period, its net loss widened to $383 million in the first quarter from $166 million a year ago.
Revenue was broadly flat at $633 million. A lower share of higher-priced Polestar 3 models and a greater amount of Polestar 4 cars being sold weighed on the topline.
“With implemented steps to improve our cost base being offset by more challenging market conditions, we are accelerating efforts to adjust our business model, become leaner and improve manufacturing efficiencies,” Polestar CEO Michael Lohscheller said, providing no financial outlook for the year.
As part of its product expansion plans, Polestar expects deliveries of a new Polestar 4 variant to begin later this year, followed by an all-new Polestar 2 in 2027 and the compact Polestar 7 SUV thereafter.
Like many EV startups, Polestar is burning cash to expand its line-up and has in recent months secured loan and equity funding from Geely and banks, while Volvo Cars is converting debt into equity. Polestar also secured approval for a 50 million euro addition to its green trade finance facility.
Its cash position was $676 million at the end of the first quarter, compared with cash of $1.16 billion in the preceding three months.
First-quarter expenses also rose on higher sales commissions, one-off personnel costs and marketing.
The company said it expected to publish its second-quarter sales on July 9.
Reporting by Harshita Mary Varghese in Bengaluru and Marie Mannes in Stockholm; Editing by Maju Samuel
