Polestar IPO faces a cooling market for EV stocks

George Gianarikas, a senior research analyst at Robert W. Baird & Co., believes a shift has occurred in how the world views EV startups.

“Part of it has to do with the change in the market’s mood — part of it with operational issues the companies have had getting things off the ground in a global supply chain crisis,” he said.

Meanwhile, competition from rapidly electrifying legacy automakers is stiffening. Luxury marques BMW and Mercedes-Benz are rolling out a fleet of high-performance battery-powered models.

“Investors are now considering traditional OEMs that they might have previously written off,” Gianarikas said.

Even so, Polestar has something Rivian and Lucid lack — a multiyear record of revenues.

Polestar sold 29,000 sedans globally last year and reported about $1.5 billion in revenue. In April, the company inked a deal to supply rental giant Hertz with 65,000 battery-powered vehicles. The five-year agreement represents more than $3 billion of potential revenue for Polestar.

“To call Polestar a startup is kind of a misnomer,” said Sam Abuelsamid, principal analyst at Guidehouse Insights.

As it scales up, Polestar is leaning on the considerable production, supply chain and retail infrastructure of its parent, Zhejiang Geely Holding, which owns several auto brands, including Volvo Cars.