By Alberto Frammartino, September 2, 2024
Electric vehicle manufacturer Polestar reported a substantial operating loss of $242.3 million for the second quarter, underscoring the ongoing difficulties facing the EV industry. The company’s revenue dropped by 17 percent to $574.9 million, a decline attributed to lower sales volumes and increased discounts. Although Polestar achieved an 83 percent increase in sales compared to the previous quarter, it still delivered fewer vehicles than in the same period last year.
Once a frontrunner in the EV sector, Polestar is now grappling with heightened competition from both established and emerging automakers, particularly from China. This, coupled with softening consumer demand driven by high inflation and the reduction of government subsidies in key markets, has forced the company to implement discounts to stimulate sales.
These challenges have taken a toll on Polestar’s stock price, which has plunged by over 90 percent since the company’s spin-off from Volvo two years ago. In response to these difficulties, Polestar announced that Michael Lohscheller, former head of Opel, will replace Thomas Ingenlath as CEO in October.
Despite these setbacks, Polestar remains hopeful for a stronger second half of the year. The company anticipates increased sales of its premium SUVs, the Polestar 3 and 4, which are now in production. To strengthen its market position, Polestar has begun manufacturing the Polestar 3 in the United States, circumventing tariffs on Chinese-made EVs.
The $73,400 model, which was delayed due to software issues, is being assembled at a Volvo factory in Ridgeville, South Carolina, and will be sold in the U.S. and Europe.
