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Polestar has a bold plan: improve car sales

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Polestar has a bold plan: improve car sales

Polestar manufactures the Polestar 3 in a factory in South Carolina and last year he warned that any sales ban “shut down the operations of a legally organized U.S. company with significant U.S. investments.”

“The United States is an important market for us,” Kim Palmer, Polestar’s public relations director, tells WIRED. Suggesting the specification of software and other non-Chinese materials, Palmer adds: “We are in advanced stages of adapting our future models to ensure they comply with regulation in terms of hardware, software and suppliers.”

However, Lohscheller may have to ask the Trump administration for a waiver to sell his American-made cars in the United States. trump antipathy towards electric vehicles is well known, but it is unclear how much of US policy on electric vehicles will go into influenced by Tesla CEO Elon Musk.

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

If this turns out to be the case, it could be very difficult for Polestar to obtain the waiver. Perhaps that is why Lohscheller highlighted Polestar’s turn towards France in his presentation. A trademark dispute with Citroen: the company claimed the The Polestar logo was too similar to yours—previously prevented Polestar from selling in the French market.

However, there is a potential problem. Potential Polestar buyers do not yet qualify for France’s electric vehicle subsidy. “Polestar is not on the list of companies authorized by France to benefit from the ecological bonus,” says Wells. “That doesn’t mean they can’t participate in the future, but if they can’t qualify for that plan, they’re going to have an incentive problem.”

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

“A lot of things need to change,” Lochscheller said, “starting with sales and distribution. I call it from display to active sale. “The company has done a good job establishing the direct-to-consumer baseline, now the key task is to ensure that active sales through retail partners are improving.” More showrooms, then, and less reliance on online sales: old-school thinking.

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

“By expanding dealer sales, Polestar can reach more customers, thereby increasing overall sales volume,” Stephanie Valdez Streaty, director of industry insights for Cox Automotive, publisher of vehicle appraiser Kelley Blue, tells WIRED Book. “Customers are more likely to invest in a brand they can interact with and trust,” he says.

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

Lochscheller, Wells says, is instilling in Polestar a “sense of conservatism, an attempt to reduce 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 GT that rivals the Porsche Taycan, will go on sale later this year and is built on the company’s first custom EV architecture. brand. The proposed Polestar 7 could do well in the United States, Streaty says. “Developing a vehicle in the premium compact SUV segment is a smart decision,” he says.

With at least two years left to break even, Polestar will likely need additional financing to reach profitability. But Polestar, which depends on the support of its Chinese ultimate owner, may not be two years old, Wells says. “The Chinese electric vehicle market is booming, but there is a lot of competition and rampant price cuts. The risk for Polestar is that its financial support may not last. Polestar could become too much of an extravagance for Geely. “Market conditions are moving faster than companies’ strategic plans.”

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