Polestar-SPAC (GGPI) Gains 7% as Hertz Orders 65,000 EVs
Polestar announced today that the premium electric performance car maker has entered into a new global partnership with Hertz (NASDAQ:) rental. The partnership includes purchasing up to 65,000 electric vehicles over five years. The SPAC that is merging with Polestar – Gores Guggenheim Inc (NASDAQ:) – is gaining 7% in pre-open trade following the news.
“We are excited to partner with Polestar and look forward to introducing their premium EV products into our retail and rideshare fleets,” said Stephen Scherr, Hertz CEO. “Today’s partnership with Polestar further builds on our ambition to become a leading participant in the modern mobility ecosystem and doing so as an environmentally-forward company. By working with EV industry leaders like Polestar, we can help accelerate the adoption of electrification while providing renters, corporate customers and rideshare partners a premium EV product, exceptional experience and lower carbon footprint.”
Polestar has pushed global EV growth, reportedly tripling volumes in 2021. The company anticipates more than doubling volumes again this year. Polestar expects volumes to reach 290,000 vehicles per year by the end of 2025.
“Polestar is committed to accelerating the move to electric mobility with a fascinating and innovative product portfolio,” said Polestar CEO Thomas Ingenlath. “We are delighted that Hertz has chosen Polestar as a strategic partner on their road to electrification. The partnership with a global pioneer like Hertz will bring the amazing experience of driving an electric car to a wider audience, satisfying a broad variety of our mutual customers’ short- and longer-term mobility requirements. For many of them it may be the first time they have driven an EV, and it will be a Polestar.”
Polestar is not the first electric vehicles to catch the rental company’s interest. On October 25,2021, Hertz placed an order for 100,000 Tesla (NASDAQ:) vehicles. Mark Fields, Hertz’s interim chief executive officer at the time, said Tesla was the only company that could produce EVs at scale. This first step in the company’s plan to electrify its fleet was followed up by the recent addition of the Tesla Model Y to the Hertz list of available fleet vehicles.
Hertz and Polestar did not share the financial terms of the planned rental-car purchase. The Tesla deal was reportedly worth $4.2 billion. The starting sticker price of the Polestar 2 sedan is $45,900, meaning the deal could generate almost $3 billion of revenue if Hertz pays at or close to that price.
Hertz’s Tesla partnership fueled a more than 40% spike in the car renters’ shares in late October.
Polestar previously announced its intention to list on Nasdaq New York in a proposed business combination with Gores Guggenheim, Inc. That deal is expected to close in 2Q 2022.
By Michael Elkins
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