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Polestar, an electric car manufacturer backed by Volvo and Geely, has opened the door to listing vehicles with blank checks as it seeks more firepower to compete in an increasingly competitive global market.
The group attracted Chinese investors for US$550 million in April, and the group plans to raise further funds as it prepares to manufacture cars in the United States for the first time.
Fundraising can be done through traditional initial public offerings or through special purpose acquisitions of companies.
Polestar CEO Thomas Ingenlath said: “I will not reject IPO or Spac, but it definitely does not decide when it will happen,” and emphasized that the group is pursuing “long-term investors”.
In the past 18 months, electric vehicle start-ups have been one of the biggest winners of the Spac craze as they try to dazzle investors by demanding their technology and potential market size.
However, this has led to an oversupply of listings, and the weaknesses of several companies since joining the Spac stampede have been exposed.
Inglenath said that the support of Volvo Cars and its parent company, Geely, has enabled Polestar to reap the benefits that major automakers have.
Volvo and Geely retained a majority stake in Polestar, which sold its first car in 2019, but has not disclosed any financial results.
The company will start producing electric sport utility vehicles at Volvo’s South Carolina plant next year.
Polestar produces its flagship model Polestar 2 at a plant in Chengdu, China, but faces high tariffs when exporting cars to the United States.
The decision to produce the next model Polestar 3 in the United States and China means that it will avoid imposing import duties on this car. The size of this car will be the same as the Volvo XC90 SUV, and it will go on sale later next year.
Although the US electric vehicle market is still in its infancy, Polestar expects significant growth and has opened showrooms across the country. Inglenath said that its latest model is aimed at the high-end market and is more likely to compete with models of high-end startup Lucid than Tesla.
Ingenlath said the fact that this car will be produced in the United States and China “proves” that the group can use its parent company to help achieve globalization. “Since there is already a factory in operation and it has been decided to bring the new electric platform there, this is a great opportunity for us,” he added.
Volvo opened a plant in South Carolina in 2018, and the automaker has pledged to fully electrify all its models by 2030.
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