Electric vehicle maker Polestar cuts production forecast and jobs

STOCKHOLM (Reuters) – Swedish electric vehicle (EV) maker Polestar on Thursday lowered its 2023 production forecast and said it would cut its workforce by 10%, citing a delayed production start for its Polestar 3 and an environment difficult for the industry.
The automaker said it now expects to produce between 60,000 and 70,000 cars this year, up from 80,000 previously planned.
It was a difficult quarter for electric vehicle startups, which face increasing competition from new Chinese players as well as more established brands. An ongoing price war launched by Tesla, in addition to high interest rates, has put additional pressure on already cash-strapped startups.
Polestar peers such as Lucid and Fiskerboth cut their production forecasts, with Lucid in March also reducing its workforce by 18%.
Polestar said the start of production of its Polestar 3 would be delayed to the first quarter of 2024 instead of the initial start in mid-2023. The company said the delay was due to Volvo cars – which produces its own cars and delays its own EX90 – must continue software development and testing.
Cash and cash equivalents at the end of the first quarter were $884.3 million, compared to $973.9 million in the prior three-month period. An operating loss of $199.4 million was narrower than a loss of $257.9 million a year ago.
Fears of running out of cash have been a prominent issue for electric vehicle startups, where many players have seen their initial market valuations evaporate, with few financing options in a turbulent economy.
Polestar has previously said it has sufficient funds to see it through to 2023, after receiving $1.6 billion in funding in November from its two largest shareholders, Volvo Cars and Li Shufu. PSD investment,
However, it will still need additional funding to get through the next few years.
U.S.-listed Polestar shares fell more than 6% in premarket trading.


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