Polestar lands a USD300M cash boost as Geely converts debt to equity
Polestar Automotive has just secured USD300 million in new financing, giving the struggling electric vehicle brand temporary relief as losses mount and liquidity remains tight.
So, why is this electric car brand struggling? Well, there is slowing global EV adoption, increased competition (like from BYD and Tesla), and geopolitical issues (US tariffs, EU duties on Chinese EVs) hurting its sales and profitability. Then, there is its premium pricing which doesn’t always align with consumer perception, especially in China where local EV brands offer more features for less money.
The deal arrived alongside a separate agreement with its Geely parent network, underscoring growing urgency around Polestar’s balance sheet while buying management time to execute a broader turnaround strategy.
The USD300 million financing was split evenly between Banco Bilbao Vizcaya Argentaria and Natixis, according to the company. Polestar also confirmed that Geely Sweden Holdings agreed to convert roughly USD300 million of existing debt into equity, easing near-term repayment pressure and strengthening the automaker’s capital structure.
CEO Michael Lohscheller said the transactions “significantly enhance our liquidity position and help strengthen our balance sheet.” The financing followed an earlier announcement that Polestar secured a new credit agreement with a wholly owned Geely unit, providing access to a term loan of up to USD600 million if needed, according to Transport Topics.
Polestar is the Swedish electric performance car brand with a focus on design and innovation, and the ambition to accelerate the change towards a sustainable future.
Headquartered in Gothenburg, Sweden, its cars are available in 28 markets globally across North America, Europe, and Asia Pacific.
Polestar has four models in its line-up: Polestar 2, Polestar 3, Polestar 4, and Polestar 5. Planned models include Polestar 7 compact SUV (to be introduced in 2028) and the Polestar 6 roadster. With its vehicles currently manufactured on two continents, North America and Asia, Polestar is diversifying its manufacturing footprint further, with production of Polestar 7 planned in Europe.
