Polestar Refuses to Slash Prices in Response to Tesla
Polestar CEO Thomas Ingenlath refuses to engage in a “price war” with Tesla and will hold prices steady.
At the beginning of the year, Tesla slashed prices by up to 20% in response to upcoming EV tax credit legislation and a rapidly slowing car market. Other automakers have followed suit, including Ford, which ignited a price war among EVs. However, Polestar is refusing to slash prices in response to Tesla.
Projections across the industry have been becoming more tempered and slow in the wake of a contracting car market. Chevrolet had to throttle production of the Silverado to manage inventory. Carvana posted an over $800 million loss. And Tesla slashed prices on most of its cars to stoke sales, making some Teslas fairly affordable to more folks. According to a report from Reuters, Polestar CEO Thomas Inglenlath refuses to slash prices on Polestar vehicles, even with a 2023 production well below original forecasts.
"We will not engage in a price war...we are aiming to become a very premium sportscar company. It's very clear that this is a completely different aim from where Tesla is going, with 20 million cars per year." Said Inglenlath in an interview with Reuters.
It’s clear that Polestar is more concerned with brand image than overall sales, which is a key consideration in building a luxury marque. While Polestar was once slightly separated from its parent Volvo, now the brand is the premium EV arm of the Swedish automaker. Thus far it has made two cars: the performance hybrid Polestar 1 and premium EV hatchback Polestar 2, while Volvo has the XC40 Recharge EV. In terms of price, the Polestar 2 competes with Tesla, but does present a much different experience.
Polestar’s hasn’t changed its January production outlook of 80,000 cars, up from 51,000 it delivered in 2022. According to Inglenrath, the supply chain issues slowing production left Polestar with a strong order book. Thus, it has no need to slash prices.
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