Electrical automobile maker Polestar cuts manufacturing steering, jobs

Could 11 (Reuters) – Swedish electrical automobile (EV) maker Polestar lowered its 2023 manufacturing steering on Thursday and mentioned it might lower headcount by 10%, citing a delayed manufacturing begin for its Polestar 3 and a difficult setting for the trade.

The auto maker mentioned it now anticipated to supply between 60,000 and 70,000 automobiles this 12 months, versus the beforehand predicted 80,000.

It has been a troublesome quarter for EV startups, who face mounting competitors from new Chinese language gamers in addition to from extra established manufacturers. An ongoing value struggle began by Tesla (TSLA.O), along with excessive rates of interest, has put an additional squeeze on the already cash-strapped startups.

Polestar friends reminiscent of Lucid (LCID.O) and Fisker (FSR.N), have each lower their manufacturing forecasts, with Lucid in March additionally trimming 18% of its workforce.

Polestar mentioned the manufacturing begin of its Polestar 3 can be delayed till the primary quarter of 2024 as a substitute of the preliminary mid-2023 begin. The corporate mentioned the delay was as a consequence of Volvo Automobiles – which produces its automobiles and is delaying its personal EX90 – having to do additional software program improvement and testing.

Money and money equivalents on the finish of the primary quarter had been $884.3 million, in contrast with $973.9 million within the previous three-month interval. An working lack of $199.4 million was narrower than a lack of $257.9 million a 12 months in the past.

Worries of money operating out have been a prevailing concern with EV startups, the place many gamers have seen their preliminary market valuations evaporate, with few choices for funding in a turbulent economic system.

Polestar has mentioned beforehand it has enough funds to see it by means of 2023, after it obtained $1.6 billion in financing in November from its two largest shareholders Volvo Automobiles and Li Shufu-controlled PSD Funding,

Nevertheless, it is going to nonetheless want additional funding to get by means of the following few years.

Shares in U.S listed Polestar had been down over 6% in pre-market buying and selling.

Reporting by Marie Mannes, modifying by Terje Solsvik

Our Requirements: The Thomson Reuters Belief Rules.