Polestar Slashes Production Guidance and Announces Layoffs!
A Swedish electric vehicle manufacturer, Polestar, announced a reduction in its production outlook for 2023.
The company cited a difficult industry landscape and delayed production launch for its 2023 Polestar 3 as reasons for the adjustment. As a result, they plan to reduce their workforce by 10%. The updated production estimate for this year is between 60,000 and 70,000 vehicles, down from the prior projection of 80,000.
The last quarter has been challenging for electric vehicle startups, as they encounter intense competition from both new Chinese players and established brands. Tesla's price war and high interest rates have exacerbated the financial problems of startups that were already struggling to make ends meet.
Other electric vehicle manufacturers, like Lucid and Fisker, have reduced their production predictions. In March, Lucid also let go of 18% of its employees.
2023 Polestar 3's production has been delayed till Q1 2024 due to Volvo Cars' delayed EX90, which requires additional software development and testing. At the end of Q1, Polestar had $884.3 million in cash, and the operating loss of $199.4 million was narrower than last year's $257.9 million loss. Polestar has received $1.6 billion in financing from its two largest shareholders, which will last until 2023. However, the company still needs additional funding to survive the next few years.
Source: Polestar
