Polestar Jumps Over 22% After EV Maker Secures Almost $1B in Financing

American depositary receipts (ADRs) of Polestar (PSNY) soared over 22% Wednesday as the Swedish electric vehicle (EV) maker said it secured $950 million in external financing.

The company said the money is coming from 12 “leading international banks,” and will be in the form of a three-year loan facility. The development comes after partial owner Volvo said earlier this month it would be pulling its funding for Polestar, which had $770 million on its balance sheet at the end of last year.

The carmaker said that the capital infusion provides the funds it requires “to finance the next stage of its development and covers a large majority of its estimated financing needs.”

Polestar said the funding will be accompanied by “a comprehensive efficiency program,” including layoffs. It added that the company has already reduced its workforce by 10% since mid-2023, and a further 15% cut in jobs will happen this year.

CEO Thomas Ingenlath said Polestar has “reinforced our path towards cash flow break-even targeted in 2025.” The company added it expects volume growth meeting its 2025 goal with a double-digit percent gross profit margin.

The company reported Tuesday that it had begun production on its Polestar 3 model in Chengdu, China. Manufacturing of the car in Ridgeville, South Carolina, is set for later this year.

With Wednesday’s gains, Polestar ADRs have rebounded from their all-time low last Friday but they’re still down about 65% over the past year.