Electric vehicle maker Polestar said on Monday it has secured a $400 million equity investment from Feathertop Funding Limited, a special purpose entity consolidated by Sumitomo Mitsui Banking Corporation and Standard Chartered, as the Swedish automaker works to strengthen its finances amid a broader slowdown in EV demand.
The latest funding follows a $300 million equity investment in December from BBVA and Natixis, as well as a loan agreement of up to $600 million with Polestar’s majority owner, Geely Holding.
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“Following the new equity financing and the funding announcements in December, and with the support of Geely Holding, we continue to make progress on enhancing our liquidity position and strengthening our balance sheet,” Polestar Chief Executive Michael Lohscheller said.
Polestar has been navigating a cash crunch after burning through significant capital in its effort to scale production, a challenge shared by many EV-focused startups. The company has also faced persistent pressure from debt covenants, prompting repeated negotiations with lenders to amend terms and remain compliant.
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Polestar said neither Sumitomo Mitsui nor Standard Chartered would own more than 10% of its outstanding equity after the transaction closes.
The funding underscores ongoing efforts by the automaker to stabilise its finances as demand growth for electric vehicles moderates globally and access to capital becomes more selective.