Polestar has a bold plan — get better at selling cars

Polestar manufactures the Polestar 3 at a factory in South Carolina and warned last year that any ban on sales “shuts down the operations of a legally organized American company with substantial American investment.”

“The US is an important market for us,” Kim Palmer, Polestar’s head of PR, told WIRED. Offering the specifications of non-Chinese software and other materials, Palmer added: “We are at an advanced stage to adapt our future models to make sure they comply with the regulation in terms of hardware, software and suppliers.”

However, Lohscheller may have to ask the Trump administration for permission to sell US-made cars in the US. of Trump antipathy to electric cars is well known, but it is not clear what America’s EV policy will be influenced by Tesla CEO Elon Musk.

“It’s an unusual conflict of interest to see Tesla’s CEO in any way connected to nationwide EV policy,” said Peter Wells, business professor and director of the Center for Automotive Research at Cardiff University in Wales. United Kingdom. “There’s huge potential (for Musk) to rewrite the rules to suit Tesla’s best interests.”

If that turns out to be the case, it could prove very difficult for Polestar to get permission. Perhaps that is why, in his presentation, Lohscheller emphasized Polestar’s focus on France. Trademark dispute with Citroen – the company claims to Polestar’s logo was too similar to its own— previously prevented Polestar from selling on the French market.

However, there is a potential problem. Prospective Polestar buyers are not yet eligible for an EV subsidy from France. “Polestar is not on the list of companies that have been approved by France to be eligible for their environmental bonus,” Wells says. “That doesn’t mean they can’t participate in it in the future, but if they can’t qualify for this scheme, they have an incentive problem.”

Lochscheller said that 2024 has been a year of transition for Polestar and that the company will now return to a more traditional dealer-based sales model.

“A lot of things have to change,” Lochscheler said, “starting with sales and distribution. I call it showing to active selling. The company has done a good job of establishing the direct-to-consumer baseline, now the key task is to ensure that active sales through retail partners improve.” Then more showrooms and less reliance on online sales – old-school thinking.

“Our (sales) footprint is growing,” said Lochscheller, citing the fact that there are now 25 Polestar showrooms in Sweden, 20 more than last year, and 20 in the UK, up from eight last year.

“By expanding dealer sales, Polestar can reach more customers, thereby increasing overall sales volume,” said Stephanie Valdes Stretti, director of industry insights for Cox Automotive, publisher of vehicle appraiser Kelley Blue Book. for WIRED. “Customers are more willing to invest in a brand they can interact with and rely on,” she says.

Wells agrees: “Polestar, under new management, will now finally focus on being better at retail and being better at driving revenue. They return to the traditional (automotive) sales model and present themselves to consumers in a less exotic way.

Lochscheller, Wells says, instilled in Polestar “a sense of conservatism, trying to cut costs, increase volumes, adopt a more traditional marketing strategy and generate enough revenue to survive.”

Polestar cars are available in 27 countries. Production of the Polestar 4 will begin in South Korea in the second half of 2025. The Polestar 5, a rival to the Porsche Taycan GT, is due to go on sale later this year and is built on the the first EV architecture to order. The proposed Polestar 7 could do well in the US, Streaty claims. “Developing a vehicle in the premium compact SUV segment is a smart move,” she says.

With break-even at least two years away, Polestar will likely need additional funding to turn a profit. But Polestar – reliant on the support of its ultimate Chinese owner – could be gone for two years, Wells said. “The Chinese EV market is booming, but there is a lot of competition with rampant price cuts. The risk for Polestar is that their financial support may not continue. The Polestar may take extravagance too far for Geely. Market conditions evolve faster than the company’s strategic plans.”