Polestar, Volvo Car Group’s standalone electric performance brand, has raised $550 million in its first external round led by Chongqing Chengxing Equity Investment Fund Partnership, Zibo Financial Holding and Zibo Hightech Industrial Investment.
SK Inc., the South Korean global conglomerate, and a range of other investors also participated.
While this is Polestar’s first external round, the company’s comments suggest it won’t be its last. Polestar said Thursday that the growing market for electric vehicles coupled with advancements in technology that have made EVs more economical have attracted investors. Polestar added that it is in ongoing discussions with global investors about possible additional fund raising.
“Our new investors have recognized that Polestar offers an alluring combination of established industrial and technological capability alongside superlative growth potential as the global auto industry goes electric,” Polestar CEO Thomas Ingenlath said in a statement.
The new capital will diversify’s Polestar’s funding structure and “deepens the pool of resources available to accelerate product development and technological capabilities ahead of launching several ground-breaking cars in the coming years,” the company said in its announcement.
Polestar was once a high-performance brand under Volvo Cars. In 2017, the company was recast as an electric performance brand aimed at producing exciting and fun-to-drive electric vehicles — a niche that Tesla was the first to fill and has dominated ever since. Polestar is jointly owned by Volvo Car Group and Zhejiang Geely Holding of China. Volvo was acquired by Geely in 2010.
Since its launch, Polestar has opened a manufacturing facility in China, built a global sales and distribution operation, and launched two vehicles, the Polestar 1 and the all-electric Polestar 2.
The company is adding its lineup, announcing this week that it will produce two additional versions of the Polestar 2 EV with lower base prices.
One new variant will be a new single motor Polestar 2 that retains the 78 kWh battery of the dual motor model, and delivers an estimated EPA range of about 260 miles. Polestar offers the Plus Pack, which extends the range up to 10%. The single motor Polestar 2 will arrive in North America at the end of 2021.
Polestar said it will also a more simply configured dual motor version. The dual motor Polestar 2 has estimated EPA range of 240 miles, and can go even further on a charge when fitted with the new Plus Pack.
The company also announced grander ambitions to build the first climate-neutral car by 2030. That climate neutral badge won’t be earned throough carbon offsets, but by fundamentally change the way the new EV is made, Polestar said, including rethinking every piece of the supply chain, from materials sourcing through to manufacturing, and even by making the vehicle more energy efficient.