Volvo's Polestar 2 takes aim at Tesla Model 3

Urvaksh Karkaria

Automotive News | 2019-3-1

Polestar, Volvo's electrified vehicle upstart, is ready to take on the Tesla Model 3.

The Polestar 2, introduced Wednesday ahead of its formal debut at the Geneva auto show, will be powered by two electric motors and a 78 kilowatt-hour battery, delivering 275 miles of range. The all-wheel-drive electric powertrain produces 300 kilowatts (408 hp) and can sprint from 0 to 62 mph in less than 5 seconds. 

With a minimalist cockpit dominated by an 11-inch iPad-style screen, the five-door, midsize luxury sedan is more homage than competitor to the Model 3.

The China-built Polestar 2 will arrive in the U.S. in early summer next year, Polestar North America chief Gregor Hembrough told  Automotive News   recently. 

The car will be based on Polestar¡¯s compact modular platform, which underpins the Volvo XC40 crossover. Gothenberg, Sweden-based Polestar is the electrified performance brand of Volvo Cars, which is owned by Geely Holding Group Co.

The Polestar 2 will start at about $44,000, before tax incentives. But, as with the Model 3, buyers will have to be patient. A well-quipped ¡°launch edition¡± will be the only model available during the first year of production and cost $63,000, before incentives. 

While crossovers are currently more popular among consumers than sedans, Polestar decided to go with a more competitively priced sedan first because it would open up the brand to a wider market. 

¡°With a price tag of $63,000 before federal incentives, we knew that we could have the ability to reach a far greater audience than maybe launching another premium vehicle,¡± Hembrough said.

With Polestar, Volvo is elbowing into an increasingly crowded EV market, once dominated by Nissan and Tesla. Trade tensions between China and the U.S. and the threat of escalating tariffs will add to the pressure, threatening profitability.

Tariffs are ¡°complicating¡± the picture, Hembrough conceded, adding ¡°there¡¯s very little we can do at this point."

Android integration
The Polestar 2 is crucial to achieving Polestar CEO Thomas Ingenlath¡¯s goal of making the brand profitable within five to seven years with annual global sales of more than 100,000. 

Polestar is said to have at least a half-dozen battery electric models planned over the next decade. In addition to the Polestar 2 and Polestar 1, a $155,000, limited-run hybrid sedan is expected to arrive this year. The automaker also has plans for an SUV, a sporty crossover and a roadster, according to a source.

The Polestar 2 receives power from a 27-module battery pack that is integrated into the floor. The company says the layout results in a more rigid chassis, which provides better driving dynamics, while also improving the car¡¯s noise, vibration and harshness levels. 

A performance version improves driving dynamics with ?hlins dampers, Brembo brakes and 20-inch forged wheels. It is also equipped with Polestar¡¯s signature gold seat belts, brake calipers and valve caps.

The Polestar 2 will be Volvo¡¯s first model with Google¡¯s Android operating system embedded into the infotainment system, providing access to Google Maps, Google Assistant and the Google Play Store. Smart features such as enlarged graphics in the instrument cluster allow the driver to see the charging status and range before entering the car.

Volvo¡¯s decision to team up with Google rather than reinvent the wheel with an in-house infotainment solution was about pragmatism.

¡°Why would you ever pick that fight and invest the same amount of money? It would be an endless struggle to make it as good [as Google¡¯s system],¡± Volvo r&d boss Henrik Green told  Automotive News Europe  at the Los Angeles Auto Show in November.

¡°We want to give our consumers a fantastic experience where their cars are as seamlessly integrated as any other device," Green said. "After coming to that conclusion, it was super easy to jump on board with the Android embedded program.¡±

Google¡¯s system also will be built into models produced on Volvo¡¯s second-generation SPA2 platform, which will debut in 2021 with launch of the third-generation XC90.

Technology forward
Hembrough described the ideal Polestar 2 customer as being ¡°technology forward¡± and an early adopter.

¡°Someone who is looking to explore new technology, new brands and along with that also coveting much more about what the attributes are of the product, rather than the attributes of the brand,¡± he said.

Hembrough pegged global production of the Polestar 2 in the ¡°tens of thousands (of units), rather than thousands,¡± declining to provide a firmer estimate. ¡°I¡¯d really feel much more comfortable answering that in about 90 days,¡± he said.

Similar to Tesla, Polestar hopes to poach business from European luxury brands.  ¡°What we are going to see is a very large audience of internal combustion engine customers come into the Polestar 2,¡± Hembrough said. 

North America is expected to be the third-largest market for Polestar, trailing China and Europe. Hembrough ruled out U.S. production of the Polestar, for now.

¡°We will continually monitor different opportunities based on market demand, whatever might happen with trade tariffs and also profitability,¡± he said.

Ingenlath told  Automotive News Europe  last year he is happy Polestar doesn¡¯t ¡°have to start from scratch¡± in the EV market. 

¡°We will accelerate things in that segment by offering another highly attractive product,¡± he said, adding that the Polestar 2 will provide more variety for consumers. ¡°At the moment, there are cheaper electric cars, but they just do not offer the same premium experience. I have nothing against the cars that are there in the price range of 30,000 to 50,000 euros, but they are not the emotionally exciting driver¡¯s cars that we plan to bring.¡±

Polestar is adopting an experiential U.S. retail strategy, bringing the brand to where people congregate or shop. The company envisions small, low-cost stores in malls and mixed-use urban developments, instead of multimillion-dollar, Taj Mahal-style showrooms with expansive service centers.

Initially, Polestar expects to have stores in five cities on the West Coast and in three cities in Canada. The West Coast is a natural launch market because it has high EV adoption, attractive government incentives and robust charging infrastructure.

Hembrough declined to say when Polestar vehicles would become a nationwide brand or elaborate on the eventual size of the Polestar dealer network. Expansion markets will be based on where there is demand, charging infrastructure, and where dealers can be profitable.

Doug Bolduc contributed to this story.

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