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Electric car manufacturer Polestar plans to produce in Europe
The Swedish Tesla competitor Polestar, controlled by Chinese owners, wants to manufacture cars on its home continent for the first time. The new model Polestar 7 is to be produced in Europe, said Polestar CEO Michael Lohscheller to the news agencies dpa-AFX and dpa.
"The costs are significantly lower than shipping cars around the world," explained the former Opel CEO. "It also naturally gives us protection from tariffs." The EU had introduced punitive tariffs on electric cars from Chinese production last year.
No date yet for European production
So far, Polestar produces in Asia, mainly in Chinese factories, and in the USA at Volvo. According to Lohscheller, it is not yet decided where exactly and with which partner the new car planned as an SUV will be built in Europe, nor is the date for the market launch set.
The manager wants to put the business in Europe on a broader footing overall, including in Germany and France. So far, the carmaker sells its cars mainly through online orders and then delivers them through its few showrooms. In the future, Polestar cars will also be available for purchase at around 300 dealers worldwide.
Sales Decline 2024
The electric car manufacturer experienced a rough patch, both in sales and financially. In 2024, 44,851 cars were delivered to customers, 15 percent less than the year before. On Thursday, the stock fell by more than ten percent in New York trading after the company reduced its revenue forecast for 2024.
However, by 2027, deliveries are expected to grow by an average of 30 to 35 percent annually, said Polestar CEO Lohscheller. This year, he aims to break even on the adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). Polestar underwent a radical restructuring and cut about a quarter of its workforce, with around 600 of the previous 3,100 employees having to leave. In 2027, the company aims to be financially self-sufficient and able to support its own investments.
Contributions to business are also expected from revenues generated by the sale of CO2 certificates. Lohscheller anticipates three-digit million euro revenues from this source this year.
Uncertain Prospects in the US Market
Meanwhile, Polestar has a problem in the USA. The US government decided this week that starting with the model year 2027, no connected cars from manufacturers under Chinese control may be sold. This also applies to vehicles produced in the USA. Although Polestar builds cars in the US state of South Carolina, the majority is owned by the Chinese Geely Group and its founder Li Shufu. "We will find solutions for that," said Lohscheller. The USA is an important market - and there is still time.
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