Polestar (PSNY) CEO says rivals are falling into a trap by delaying EV plans

Polestar (PSNY) has been clear about its belief in an all-electric future. The company’s CEO, Thomas Ingenlath, is now calling out rivals for pulling back on EV plans, saying they are falling into a “trap” and they will be left behind as the industry transitions.

Shortly after securing $1 billion in funding last week, Polestar plans to expand the brand into new markets.

Polestar has two high-margin electric SUVs, the Polestar 3 and 4, launching this year in key markets. The Polestar 4 went on sale in Europe and Australia last month with up to 379 mi WLTP range, with sales accelerating globally.

Polestar 3 production began in China last week, with the first test runs at its SC plant successfully completed.

With the new injection of funds, Polestar expects to achieve “volume growth that supports the 2025 volume target and double-digit gross profit margin.”

Polestar delivered 12,800 vehicles in Q4, including 880 Polestar 4s in China. The EV maker handed over 54,600 vehicles last year, up 6% from 2022.

Despite a “challenging market,” Polestar is plowing ahead with plans for a five performance EV lineup by 2026.

Polestar says rivals are falling into a trap with EV delays

The same cannot be said for rivals like Mercedes-Benz, which drastically pulled back on its EV sales target less than two weeks ago.

Polestar’s Ingenlath told The Telegraph that automakers like Mercedes, Ford, Aston Martin and GM delaying EV plans were falling into a trap. He explained they would be left behind, given the complex process of launching new EVs.

“There’s an incredible threat and danger if you don’t embrace future innovation and believe in that technology – the electric drivetrains, the innovation in battery, the innovation in modern electronics and software,” Ingenlath said.

Polestar’s leader added, “If you don’t participate in that and think you can wait, and customers are ready for it, it’s an incredible trap.”

The comments come after Polestar’s former parent company, Volvo, sold its majority stake in Polestar and cut funding as it focused on its next growth stage. The $1 billion in funding was from external sources outside of Volvo.

Although many compare Polestar to Tesla, Ingenlath said the two differ in “the market that we are going for.”

Polestar is “not in the same game to do the mass market and compete with the traditional [car makers] in that field.” The company’s focus on higher-end EVs will help it weather a downturn in the market, Ingenlath said.

Electrek’s Take

Ingenlath is spot on here. Automakers that fail to keep up with EV tech now are falling into a “trap” and will be left behind as the industry moves forward.

Ford’s CEO Jim Farley already said if you cannot compete with the Chinese, “then 20% to 30% of your revenue is at risk.” For this reason, Ford is developing a low-cost EV platform to take on new markets and compete with Tesla.

While others are pulling back, Ingenlath sees it as an “incredible opportunity for Polestar,” especially in premium performance cars.

Other automakers like Volvo and Hyundai are doubling down with new models launching this year. For example, Volvo’s most affordable EX30 led to a record EV sales share (22%) last month.