Polestar, a Swedish electric vehicle maker, has started production of its Polestar 3 SUV in the United States in an effort to avoid steep tariffs imposed on Chinese-made cars. The move comes as many automakers are looking to shift production away from China to avoid these tariffs. Polestar, which is majority owned by China’s Geely, previously manufactured its vehicles in China and exported them to overseas markets. The Polestar 3, manufactured at Volvo’s US plant in South Carolina, will be sold to customers in the US and Europe.
In a recent statement, Polestar CEO Thomas Ingenlath confirmed that the majority of Polestar 3 volumes will be produced at the South Carolina factory. Production at the plant is expected to reach full volume within two months, with deliveries to US customers starting next month followed by deliveries to Europe. Polestar had previously sold 3,555 Polestar 2 sedans in the US during the first half of the year, according to estimates.
In addition to the US production, Polestar plans to build its Polestar 4 SUV coupes at a South Korean plant owned by Renault Korea, also part of Geely, in the second half of 2024 for Europe and the US. The company has long had plans to diversify its production locations, with intentions to partner with European automakers in the next three to five years. The decision to produce in the US and South Korea comes as high interest rates have affected consumer appetite for EVs, leading to price cuts and production delays across the industry.
Looking ahead, Polestar is focusing on reducing material and logistics costs, as well as increasing efficiency in order to break even by 2025. The company has already reduced jobs earlier this year to streamline operations and minimize costs. As Polestar continues to expand its production capabilities across different regions, it aims to establish itself as a key player in the global EV market. By partnering with established automakers and strategically choosing production locations, Polestar is setting itself up for success in the rapidly evolving automotive landscape.
