Sales of Polestar almost halved at the beginning of 2024

Sales of EV brand Polestar took a big hit during the first quarter of this year. With only 7,200 units delivered, the figures slid by 40% in a year-on-year comparison.

Most automakers managed to grow their EV deliveries compared to the same period last year (but reported strong declines compared to the final quarter of 2023), but Polestar witnessed a significant downturn. Are the waters that the startup needs to navigate getting murkier?

New models coming

The strong sales decline is explained partly by the company’s model cycle, as the brand tries to evolve from a single-car brand, pivoting on the Polestar 2, to a multimodel brand. The 2 dates from 2019 but was updated last year, adding more range while switching from front to rear-wheel drive.

Sales have been regressing for four consecutive quarters. Seemingly, the appeal of the 2 is no longer strong enough to guarantee continuity as the wave of customers belonging to the early adopters group has passed. Additionally, Polestar also suffered from the growing reticence of rental companies to change over too quickly to EVs for their fleet. It saw a big contract with Hertz put on hold recently.

Polestar has already started deliveries of the 4, its SUV coupe without a rear window, but only in China. The model accounted for 1,200 units during the first three months of the year. European orders have opened since the end of January, but the first deliveries won’t be out before August 2024. Production of the 3, or the Polestar version of the Volvo EX90, commenced at the end of February, with deliveries starting in Q2 2024.

Turbulent times

So, it’s a transitional period for Polestar. “We move from being a one-car brand during the first half of the year to ramping up deliveries of our two luxury SUVs during the second half,” commented Polestar CEO Thomas Ingenlath.

“These two cars will provide the basis for a strong revenue and margin progression during the second half of the year, supporting our 2025 targets.” Polestar aims to deliver roughly 155,000 cars next year.

Times have been turbulent for the Swedish-Chinese auto builder of premium EVs. In February, parent Volvo announced that it would stop funding Polestar, leaving the financial care in the hands of the Chinese mother group and its owner, Geely.

The latter now has a stake of 24%, while Volvo kept 18% and will continue to collaborate at a technological level. Soon after, Polestar embarked on a funding round, which it successfully completed by securing roughly 950 million dollars from twelve international banks.