Polestar Sees Opportunity In Musk Meltdown – CleanTechnica

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

---

The CEO of Polestar, the electric car spinoff of Volvo that is now majority owned by Geely, thinks there is an opportunity for his company to benefit from the political turmoil created by recent comments from Obergruppenführer Musk on his privately owned anti-social media platform. In those comments, Musk endorsesd the far-right Alternative for Germany (AfD) party, which led to a storm of criticism in Germany where new national elections will take place soon.

“Only the AfD can save Germany,” Musk wrote. “Yes! You are perfectly right!” Alice Weidel, the AfD’s chancellor candidate, said shortly after Musk endorsed her party last month. Weidel said in a recent interview that “socialist [Angela] Merkel ruined our country” and “the Soviet European Union” was destroying Germany. Her comments prompted a backlash from political leaders in Germany. According to Politico, Chancellor Olaf Scholz said at a press conference in Berlin, “We have freedom of speech, which also applies to multi-billionaires. But freedom of speech also means you can say things that are not right and do not contain good political advice.”

Polestar has had some tough sledding lately as the luster of the EV revolution has dimmed in some places, thanks in large measure to that constant drumbeat of negativity paid for by Big Oil. The company sold just 44,851 EVs worldwide in 2024 — down 15% from the previous year — partly because new models have been slow to arrive to flesh out its lineup.

Polestar Leadership Changes

In an effort to reverse its downward trend, Polestar has moved former CEO Thomas Ingenlath aside and installed German born Michael Lohscheller as the new head of the company to turn things around. Lohscheller thinks Musk’s miscues present Polestar with a sales opportunity. According to Inside EVs, he has asked his executive team to actively lure Tesla buyers who feel uncomfortable being associated with Musk’s politics and are looking for an electric car alternative to Tesla, especially since Musk has presumably taken his eye off the ball at Tesla to focus on shoving his virulent populist views down the throats of all Americans and embraced AI instead of manufacturing.

Some Tesla owners feel neglected and antagonized by the Musk’s politics, even going so far as to buy anti-Musk bumper stickers for their cars. Tesla’s sales declined for the first time in more than a decade last year. Its market share has declined in consecutive quarters — it had 44% of the EV market in America in the fourth quarter of 2024 — as other competent electric cars have come to market. “A lot of people have a very, very negative sentiment,” Lohscheller told Bloomberg, referring to Musk’s attempts to exert his influence on European politics.

Musk has become increasingly interested in German and British politics and has voiced his support for far-right parties. At President Trump’s inauguration on Monday, he pounded his fist on his chest and then extended it in the air, a gesture that far-right supporters immediately embraced. German-born Lohscheller praised Musk’s business acumen before criticizing his interference in Europe’s politics. “I think it’s totally unacceptable. You just don’t do that. This is pure arrogance,” he said.

Polestar Has A Supply Chain Problem

According to Ward’s Auto, Polestar intends to localize the manufacturing of its electric vehicles to lessen the impact of increased tariffs in Europe and the US and as a means to control costs and lessen the carbon footprint of its cars. The brand was put together when globalization was still in vogue and it was assumed supply chains could span the world. Virtually all of the battery cells for its electric cars come from CATL, which is putting a bullseye on its back as nations threaten punitive tariffs on Chinese suppliers.

In a recent interview with BBC Business, Lohscheller reiterated that Polestar plans to begin manufacturing a new compact SUV, the Polestar 7, in Europe and to continue manufacturing the Polestar 3 in South Carolina. When asked about the threat of increased tariffs promised by the new US administration, he said, “Needless to say, the US is also a very important market not only in terms of size but in terms of influence globally. We manufacture locally in South Carolina, so we are creating American jobs and we are now ramping up the production of Polestar 3 and we are also increasing the number of dealers.”

The Polestar 7

The Polestar 7 will be an important car for the company. Top Gear says the new car will be bigger than the Volvo EX30 but smaller than the XC40, and will be developed and built in Europe with a focus on a European audience. It will use a new platform being developed by the Geely Group. “Then the Polestar team will do the steering, suspension, interface, and give it the Polestar DNA,” he said. It will feature the latest technology — fast charging, long range, 800 volt architecture for fast charging, and full over the air (OTA) update capability. At present, OTA updates typically apply to just the infotainment system in many European brands.

The Polestar 7 will be shaped by the company’s new head of design Philipp Römers, who arrived in August 2024. He replaced Maximilian Missoni, who will lead the design of the upper series cars from BMW. “The brief I gave Philipp is to highlight the performance, and show it in a confident way,” said Loscheller. “Polestar is a bit too modest at the moment. US and Chinese buyers don’t want too much understatement. But don’t expect a radical change. It’s a fine line.”

The Tariff Dilemma

Volvo and Polestar both build cars in South Carolina, a solidly Republican state. Both could find themselves insulated from political hostility toward China by that state’s Congressional contingent, who would not want to see job losses in their state. “Now we have to make sure we are working through those [Trump’s] technical details,” said Lohscheller. “But at the end of the day, we think American consumers are very open minded for electric vehicles especially on the East and West Coasts. So, we continue to grow in the US. It’s a really important market for Polestar.”

He went on to say that localized vehicle production brings other commercial advantages with it. “Polestar is listed on the Nasdaq in the U.S. and we also integrate a lot of American technology in our cars, such as Google and also Nvidia chips. The point of manufacturing locally is really important, not only from a tariff point of view but also from an economic point of view. I think the times when you shipped cars around the world has really changed. It’s a costly exercise,” said Lohscheller.

He added that manufacturing locally for different markets is good business and the company will soon announce a European manufacturing site. At the moment in Europe, the brand faces a tariff of 29.3 percent on its imported cars but could face additional tariffs on its battery packs.

Lohscheller is saying all the right things and putting a brave face on what is a difficult time for Polestar. The company has lost money for all six years of its existence. That is simply unsustainable. As we asked recently when Canoo filed for bankruptcy, “Who’s next?” We would hate for it to be Polestar, but it is going to take more than a backlash to Musk’s shenanigans to pull its chestnuts out of the fire. The clock is ticking.