Incumbent CEO Lohscheller is targeting expanded European sales and is eyeing the US market
Polestar is to move away from high-end models with limited markets such as the forthcoming 5 GT and instead focus on quick wins in big markets as it looks to establish itself beyond its start-up phase.
The aim is to expand its line-up to cover up to two-thirds of the market with different models and bodystyles, making it easier to hit the growth it needs. It's building on some solid underpinnings. In the eight years or so since Polestar was launched as a stand-alone EV brand, its vehicles have generally been well received, and it has fostered a strong, identifiable image that is the envy of some start-ups of a similar age. Key to its firm foundation has been not only Polestar's Volvo beginnings but also the backing of Chinese car giant Geely Holding. This has given the brand access to technology many start-ups wouldn't be afforded, and it has enabled an 'asset-light' business model built on the use of production capacity from other brands. Despite that, Polestar still faces challenges: it continues to grow sales and expand into new markets, but it is not yet profitable. In fact, it has lost a significant amount of money, causing its share price to drop more than 90% since its 2022 Nasdaq listing. Polestar has also had to negotiate new amendments with lenders. Original CEO Thomas Ingenlath departed in late 2024. He was replaced by Michael Lohscheller, who brought considerable experience from his time running Opel-Vauxhall. Lohscheller has made some tough decisions, substantially reducing Polestar's workforce in a drive to cut costs. And while the firm sold around 60,000 cars last year, it is still far from profitable. Hence Lohscheller's plan to expand the line-up and chase wins In large markets. European brand with Chinese backing To achieve that, Lohscheller is attempting to tap into Polestar's strengths: its European heritage, and its wealthy Chinese parent. Volvo's renaissance under Geely ownership was in part down to substantial investment, yet it also had considerable autonomy-a contrast to Geely's recent struggle to reinvent Lotus. Polestar wants to follow Volvo's approach, not only by taking investment but also by merging Geely's technology and methods - principally its speed-with a European focus. "We are a Swedish and European brand," said Lohscheller-a notable statement given Polestar's early push as a global firm. "With Geely we have access to the best technology in the world, and having that access is a good thing. Many of our larger competitors are having to buy access to third-party companies in China to get similar technology. "We have an asset-light business model. We take the best of various worlds, but the key to everything is the Swedish brand. That's why we're based here . Swedish companies are so successful in bringing innovations, and it's a super-innovative country." Lohscheller wouldn't discuss financials, but he pointed to the firm recently securing a further $700 million of funding from Geely and called it "a super-strong sign of support". Polestar's target is to hit around 100,000 annual sales, but Lohscheller won't put a date on achieving that. "I don't want to have a brand where everybody talks volume," he insisted. Even so, the development of cars such as the 5 GT – by a separate now-shuttered UK R&D team – has stretched the firm's resources, especially as the 5 will serve as a relatively low-volume halo model. Lohscheller won't criticise decisions made before he arrived at Polestar, but added: "What we are doing now is completing the picture, because if you're just in niche segments, that's not enough. We have the best EV portfolio in the world." Home focus and dealer renaissance Sales grew by 50% last year in Europe - a market that Lohscheller said is Polestar's "most important". He added "We have found a good recipe and we want to continue with that and ideally accelerate it." Lohscheller also cited "interesting" France as somewhere Polestar has "a good opportunity to go into, position our brand and capture sales. The UK will serve as a template and benchmark for Polestar's European plans. It remains the brand's largest market, and it has been helped recently by switching from a focus on selling online and through retail stores to building a network of more traditional dealers – currently around 15, with a target of 18-20, along with more than 100 service points. "We have appointed dealers and gone from showing cars to active selling," said Lohscheller. "We used to display cars and hoped people would go home and purchase them." He added: "This is a key to success. I call it the renaissance of the dealers. It's not so popular in automotive circles when you go back to doing things that were declared not so good any more, but I love doing that. Some of the things in the old days worked really well. So in Europe that's a good recipe to continue growing". Lohscheller noted that the dealer network will stay relatively small, saying that having a "limited number of high-performing dealers" is "the recipe for success". Lohscheller added that Polestar benefited from being able to draw on Volvo's established service network, and he claimed that "many of our EV competitors, especially young ones, are super-jealous of it." Challenges in US and China While Lohscheller "feels good" about Europe, the key US and Chinese markets both present different challenges. In the US, president Donald Trump has rolled back incentives for EVs and moved to strengthen the oil and gas industry-which is a challenge to an EV-only firm such as Polestar. But Lohscheller insists that the US is "an important market , and will stay an important market". Lohscheller admitted: "It's hard to predict anything- If we all knew what would happen in the US tomorrow and next month, we probably would have done things differently." But he added: "Sometimes people forget that the US is a big market. And we want to get our share of it." Lohscheller noted that, as well as the US, Canada was a key market for the firm, and it had recently changed the duties it levied on Chinese-built EVs, which is "very good news for us". Despite having a Chinese parent firm and much of its production base in the country, Lohscheller isn't focusing on China as a market for Polestar. He said: "At the moment, I don't see China as a priority. Imported EV sales in the country have struggled as domestic firms have engaged in a savage price war due to excess production amid falling sales. "It's a hyper-competitive market," said Lohscheller. "We'll monitor this, and maybe with some future cars we'll have a different opportunity to go back. Production plans Despite focusing on the European market and emphasising its European roots, Polestar won't actually make a car in the region until 2028, when the Polestar 7 will begin production at a Volvo plant in Slovakia. "We want to bring as much as possible to Europe," said Lohscheller, but he added that to meet his growth plans means putting new cars into production "in the fastest way possible". He said: "We are always exploring further opportunities. But we are also limited we can't do everything, but European production is always centre of our thinking. I've said many times, shipping cars around the world is not the best way of doing business."
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