Investing.com – Polestar (NASDAQ:) said on Friday that it expects to reach a positive gross profit margin in the fourth quarter, despite a 14% decline in electric vehicle deliveries during the third quarter. The company also said it would conduct a review of strategy and operations.
Shares of the Swedish electric car maker, which is majority owned by China’s Geely, fell more than 5% in pre-market trading.
The company is facing a decline in demand due to rising interest rates, which has pushed consumers towards affordable hybrid cars. Polestar recently underwent major leadership changes, with the appointment of a new CEO, Chief Design Officer, Chairman of the Board and Chief Financial Officer.
Newly appointed CEO Michael Lochseler, in his first public comments since taking office on October 1, expressed optimism about the company’s founding and noted that a strategic and operational review is underway.
Polestar plans to provide a more detailed update on its business and strategy alongside its third-quarter earnings report, scheduled for release on January 16. The company expects full-year revenue to remain in line with last year’s $2.38 billion, citing difficult market and challenging conditions. Import duties affect the automobile sector
“Polestar has a great foundation to build on, with access to the best electric vehicle technology, global manufacturing capability and strong support from Geely,” Loeschiller said. “Together with the management team, we are reviewing our strategy and operations, to define a clear path for the development of Polestar.”
“The key to our future success will be developing our commercial capabilities: moving from displaying cars to actively selling them.”
Polestar also reiterated its goal of achieving break-even cash flow by the end of 2024, albeit by smaller amounts than previously expected.
The company delivered 11,900 vehicles in the third quarter, down from 13,900 vehicles the previous year.
In light of current market conditions, Polestar is also in discussions with the Club’s loan lenders, who remain supportive of its loan agreements.