China plunges into luxury EV market with Polestar

Source: By John Fialka, E&E News reporter • Posted: Tuesday, November 12, 2019

A Chinese automaker has unveiled the nation’s first global sales campaign for an electric car: the Polestar 2. It’s a five-door hatchback that is “designed to compete around Tesla Model 3,” according to an advertisement yesterday in The New York Times.

The announcement came as Tesla Inc. prepares to produce its first Model 3 in its new Gigafactory in Shanghai. Both carmakers describe their models as being among the “most affordable” EVs, although the initial price for the Polestar 2 could range as high as $65,000, according to industry sources. Tesla has described the base price for its Model 3 as being below $40,000.

Neither company could be reached for comment on the looming head-to-head competition. In yesterday’s advertisement, Andrew Lytheer, Polestar’s director of global communications, said the Polestar 2 is positioned “at the cutting edge of the automotive industry at a transformational time.”

Polestar describes itself as a brand jointly owned by Volvo Car Group and Zhejiang Geely Holding Group Co. Ltd. Zhejiang Geely, a Chinese automaker, bought Volvo from U.S.-owned Ford Motor Co. in 2010. Volvo, which had auto plants in China at the time, was originally headquartered in Sweden.

The Polestar 2, which will start production in early 2020, will emerge from a newly constructed plant in Chengdu, China. China has the largest number of electric cars in the world, but the Polestar is being rolled out with an multinational sales force, including former Volvo executives.

Initial sales will begin in Norway and Canada, to be followed by a “strategically placed network of retailers in the United States.”

Nearly all major automakers in the United States and the world are now planning electric vehicles. U.S. experts had predicted that for the next few years, China’s EV companies would focus on selling in the nation’s huge domestic market.

However, the Polestar 2, which is expected to be followed by an all-electric sport utility vehicle, seems aimed at customers in the United States and Europe. They are the next largest EV markets in the world.

Polestar, which also describes itself as “an official standalone car company,” has tested its newest model at various places in the world, including in the Arctic. It plans to develop 50 locations, or what it calls “spaces,” for auto sales around the world.

The company has developed sales jargon that seems designed to cross borders. “Polestar specialists, acting as brand ambassadors on a non-commissioned basis, will engage with and inform customers about the company and its products,” explains its advertisement.

Analysts say heightened competition between all-electric cars will eventually drive prices down and help reduce greenhouse gas emissions around the world, but the results in a given country will depend on the fuels that are used to generate its electricity. China’s electric grids are among the globe’s dirtiest because they largely depend on burning coal.

In the United States, where grids increasingly use renewable energy, emissions from EVs can be much lower, roughly the equivalent of a car that gets 80 mpg.

The ad for the Polestar 2 stresses the “sustainability” of electric cars and their potent acceleration. “This is not a battery with a chassis on top,” Polestar said. “This is one system operating in harmony.”

The interior is stuffed with electronics, including voice recognition controls that can respond to a driver’s commands.

The car is supposed to be able to go as far as 275 miles between charges. And despite its power, it is also designed for noise reduction. “The interior is as quiet as a library if libraries had 300 [kilowatts],” Polestar said.