Does not involve the China market! Polar Star Motor announced that it would lay off about 15% employees in order to accelerate the improvement of profit margin.

According to Reuters, Polar Star Motor recently announced that it plans to cut about 450 employees worldwide, accounting for about 15% of its total employees, due to the current challenging market. It is understood that the main purpose of this layoff is to accelerate the improvement of profit margin and reduce the company’s total capital demand, and to achieve cash flow balance by 2025.

"This layoff does not involve the China market." The relevant person in charge of Polar Star Technology (a joint venture between Polar Star Automobile and Xingji Meizu Group) told the reporter of national business daily.

In fact, this is not the first time that Polar Star Motors has laid off employees on a global scale. In May last year, Polar Star Motor said it would pay more attention to cost management, laying off about 300 people by 10% worldwide, and freezing recruitment.

It is worth mentioning that Polar Star Motor also lowered its annual sales target several times, first to 80,000 vehicles per year, and then to 60,000 ~ 70,000 vehicles again. The official of Polar Star Automobile said that the downward adjustment of the sales target was mainly due to the fact that the new model Polar Star 3 could not be delivered in mass production on time in the summer of 2023, and it had to be postponed to the first quarter of 2024.

Despite the downward adjustment of the annual sales target, polar star automobile still failed to complete. The data shows that in 2023, the global delivery volume of polar star vehicles was about 54,600, a year-on-year increase of 6%.

In addition, the polar star car has been hard to see improvement in the China market. In the fourth quarter of 2023, Polar Star Motor delivered about 12,800 vehicles worldwide, including 880 Polar Star 4 vehicles in China market. For the performance in China market in 2023, Polar Star Motor has not released specific data. Previously, in 2022, it was widely expected that the sales volume of polar star cars in China would be around one or two thousand. In 2021, Polar Star Automobile sold 2,048 vehicles in China, accounting for 7% of global sales.

Image source: Every photo by reporter Sun Tongtong

According to public information, Polar Star Automobile was established in 2017, which was jointly built by Geely and Volvo. It is positioned as a luxury pure electric high-performance automobile brand and headquartered in Gothenburg, Sweden. Since its establishment seven years ago, Polar Star has replaced six CEOs in China, but it still failed to reverse its decline in the China market.

However, Polar Star Motor did not give up the China market. In order to reverse the decline, in June last year, Polar Star Motor announced that it would establish a joint venture with Xingji Meizu Group for the China market, namely Polar Star Technology, to fully take over the business of Polar Star in the China market. Among them, Jixing Automobile holds 49% of the shares, and Xingji Meizu holds 51%. Xingji Meizu is responsible for arranging the future financing of the joint venture company.

As a result, 2023 was called "the first year of China" by Polar Star Automobile, and the first product Polar Star 4 was also highly anticipated. During the Guangzhou Auto Show last year, Polar Star 4 adjusted the delivery price to 299,900 ~ 399,900 yuan, while the previously announced price range of Polar Star 4 was 349,800 ~ 533,800 yuan, further lowering the threshold for consumers to buy. At the same time, Polaris 4 will be equipped with a newly developed full version of Polestar OS operating system to realize the interconnection between mobile phones and cars.

Thomas Ingenlath, CEO of Polar Star Automobile, said, "Polar Star 4 is very popular in China market, and will be sold in European and Australian markets in the future. Increasing production is an important milestone for us. Polar Star 3 is expected to be delivered in the first batch this summer. We will change from a company with only one car for sale to a company with three cars, which will make us usher in a revolutionary and exciting year in 2024. "

Image source: Every photo by reporter Sun Tongtong (data map)

In fact, although the selling price has been greatly reduced, Polar Star 4, which has not yet formed its brand power, still faces considerable pressure in the increasingly fierce competition in China electric vehicle market. The reporter learned that in order to further enhance competitiveness, a few days ago, the terminal concessions of Polar Star 4 were upgraded again, with a maximum discount of 60,000 yuan.

"Now we have launched the exclusive rights and interests of Polar Star 4, including the experience official welfare of 30,000 yuan, the replacement fund with a maximum time limit of 30,000 yuan, and the rights and interests of 35,000 yuan in a limited time. The maximum is equivalent to a cash discount of 60,000 yuan. Among them, the replacement subsidy for the single motor version is 20,000 yuan, the subsidy for the double motors is 30,000 yuan, and the subsidy for the experience officer is 30,000 yuan, which is divided into four personal accounts, with 7,500 yuan each time. However, there is no discount for this model of 299,900 yuan, and it is necessary to buy another 30,000 yuan plus luxury kit. In this way, the hand price of the single-motor plus version model is 279,900 yuan, while the price of the same configuration model is 339,900 yuan, which is equivalent to a discount of 60,000 yuan. " A sales person of a polar star automobile in Shanghai told the reporter that the manufacturer’s requirements for the implementation of the replacement subsidy are not strict, as long as there are photos of the production certificate, it is not a real replacement.

In addition, at the capital market level, polar star cars do not seem to be optimistic. Since it was listed on the NASDAQ Stock Exchange in new york on June 24th, 2022, the share price of Polar Star Automobile has continued to fall, and its total market value has also plunged.

The data shows that on June 24, 2022, the closing price of Polar Star Automobile was $13/share, while on January 26 this year, the closing price of Polar Star Automobile was only $2.2/share, which was over 83% lower than that at the beginning of listing. In terms of total market value, on June 24, 2022, the total market value of Polar Star Automobile was $26.595 billion, while on January 26 this year, the total market value of the company was only $4.687 billion. In less than two years, the market value evaporated by $21.908 billion.

national business daily