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Polestar: How Volvo's EV performance brand will take on Tesla and AMG

Jordan Golson

SHANGHAI, China — Three years ago, Volvo's renaissance began with the release of the new XC90 SUV. It was made possible by a multi-billion dollar infusion of cash by Geely, the Chinese company that acquired Volvo from Ford. That's was followed by the S90 sedan, V90 wagon, and, most recently, the volume-selling Volvo XC60. More cars, including the new XC40 compact SUV, are on the way — but there is still much left to be written of the Volvo story.

The next chapter starts tonight, here in Shanghai, with Volvo's transformation of Polestar — its longtime sporty nameplate — into a standalone brand focused on sporty cars with advanced electrified powertrains as well as a full-throated embrace of purchasing cars via a subscription-model. Polestar is also something of a statement about where Volvo thinks the entire auto industry is headed.

Three cars are being announced today. First is the aptly-named Polestar 1, limited-production, plug-in hybrid, 600-horsepower grand tourer based on Volvo's Scalable Platform Architecture, the same as Volvo's new-generation 60- and 90-series cars. Production will begin in mid-2019, and will be followed by a fully-electric, midsize sedan Polestar 2 before the end of 2019. Finally, Polestar 3 will be a larger SUV-type EV.

But perhaps more interesting than the cars, which are still a few years off, is the sales process. Polestar's vehicles will all be ordered online — and you can't actually buy them. Instead, the company will offer two- and three-year all-inclusive subscriptions for its vehicles. Insurance, maintenance, and depreciation are built into a (not yet disclosed) monthly fee.

The entire Polestar process can be done online, from scheduling test drives to customization and ordering — though there will also be "Polestar Spaces" around the world, offering potential customers a place to go and ask questions of Polestar employees and test drive the vehicles. Notably, they will not be located within existing Volvo showrooms. It all sounds very Tesla-esque.

We've seen similar subscription-type offerings from a number of brands including Cadillac and Porsche, but Polestar seems to be the first company that will completely forgo both traditional dealerships and the ability to "purchase" cars. Polestar says that once the initial subscription period is up, the car will be returned by the customer and sent out again on a cheaper pre-owned subscription.

The company says it is trying to eliminate the "hassle" from the car buying and ownership process. Scheduled maintenance will be handled concierge-style, with the car picked up from the customer when it's convenient. A number of other services will be offered for an additional fee, including the temporary rental of other Volvo vehicles both domestically and internationally, car wash and valet services, or the temporary installation of a roof box or ski-rack.

Polestar vehicle maintenance will be performed at "select Volvo retailers," so they aren't left entirely out of the picture. But, thanks to the concierge pick-up and drop-off services, Polestar subscribers won't ever need to step foot in a dealership if they don't want to.

Like with the Tesla Model 3, Polestar plans to offer a phone-as-key mode, allowing the concierge service (or anyone one might wish to loan the car to) easy access to the car without the owner needing to be present.

For a half-decade, Polestar has been to Volvo what AMG is to Mercedes, or M to BMW. Several Volvo models, including the S60 sedan and V60 wagon have fully-fledged Polestar customizations, with few parts of the car left untouched in a quest for increased performance. The latest 90-series of cars, including the XC90 and V90 have more limited Polestar customizations available, including the reprogramming of engine ECUs and tweaked badging and more aggressive looks. Volvo Polestar Engineered Products will continue to exist.

Polestar was a Swedish customization and racing shop when it first partnered with Volvo in the mid-90's, but things got a lot more interesting in 2015 when Volvo acquired Polestar's performance operations outright, leaving the race team — which competes in the Scandinavian Touring Car Championship under the Cyan Racing banner — separate. Now Polestar is becoming its own wholly owned Volvo subsidiary, following in the footsteps of Mercedes which released the AMG-branded GT sports car a couple years ago.

The new Polestar Production Center is under construction in Chengdu, China. With an expected completion date of mid-2018, Polestar is capitalized with a 640 million euro joint venture between Volvo Car Group and Zhejiang Geely Holdings. Polestar will operate as a subsidiary of Volvo Car Group.

The Chengdu Production Center will also include the first Polestar Space, where potential customers can test the Polestar vehicles on a private test track, including taking the cars "to extremes not possible on public roads." More Polestar Spaces are expected to open beginning in early 2019.

In many ways, Polestar is a shot across the bow directly at Tesla. Though its first cars won't get to buyers before early 2019 at the earliest, the order book for the Polestar 1 opens today — and there are decent odds that if you were to order a Polestar 1 and a Tesla Model 3 today, you might even get them around the same time.

Polestar: How Volvo's EV performance brand will take on Tesla and AMG originally appeared on Autoblog on Tue, 17 Oct 2017 07:01:00 EDT.