Polestar betting on Polestar 3 EV SUV for U.S. crossover
Yahoo Finance’s Pras Subramanian joins the Live show to discuss Polestar’s plans to hit the U.S. EV market and CEO Thomas Ingenlath’s remarks on consumer demand and the IRA tax credit.
RACHELLE AKUFFO: Electric vehicle maker Lucid navigating a rocky road as it plans to lay off roughly 18% of its workforce as it looks to preserve cash and cut expenses. Lucid expects to complete the workforce reduction by the end of the second quarter as the company looks to continue making steps toward managing costs.
And while Lucid sticks to its cost discipline, Warren Buffett-backed EV manufacturer BYD posted a record number of electric vehicle sales, as net income soared over 400%. The Chinese EV manufacturer's performance turns up the heat with competition with Tesla for market share. However, Tesla's moves to prices in China appear not to have been enough to gain a competitive edge in the cutthroat Chinese market.
Well, Polestar is making its move to take on the established US luxury market with its electric crossover SUV, the Polestar 3. Here to discuss with the details is Yahoo Finance's Pras Subramanian. Hey, Pras.
PRAS SUBRAMANIAN: Hey, Rachelle. I know you're a big fan of the electric SUVs these days. So I had the chance see the Polestar 3 in the flesh. They bring in-- at the road show for the car in the US, they want to show it off to customers and even investors here to show them what's next for the company. I think it's their biggest release so far this year in the highly competitive EV market.
So it's coming next year, but it'll be built in China. But then starting in 2024, it will built in South Carolina at the Volvo plant there. And what will happen is that although the car right now costs more than the $80,000 IRA tax credit, I spoke to CEO Thomas Ingenlath about a cheaper version on the way. Here's what he had to say.
THOMAS INGENLATH: The Polestar 3 as an SUV will, when we introduce as well, the rear wheel drive, and the version that is not connected to all the luxury package immediately will as well qualify for the tax reduction that customers then can have. Having said that, purchase release program from day one will enable the customer to enjoy the tax relief.
PRAS SUBRAMANIAN: So what he's saying at the end there is that actually with the commercial lease exemption in the IRA, customers now will actually be able to use that tax rate at the time being for now for leasing but not purchase. So anyway, a big 2022 for the company last year. They actually had a gross profit one of the quarters, believe it or not. And 2023 no less-- is going to be no less important with that Polestar 3 and also just sort of the new kind of continuation of the Polestar 2 sales. Here's what Thomas had to say about this year coming up.
THOMAS INGENLATH: '23, then, opposite to '22, obviously will be a year that is much more connected to consumer demand since, thank god, supply chain and all of that is a little less of a burden than it was the years before. So a little bit more of normalization in our market.
PRAS SUBRAMANIAN: So some normalization there for them, but then also still a big year for them with the Polestar 4, a sportier SUV coming out later this year.
RACHELLE AKUFFO: I'll keep an eye on that. You know, I do like a sporty EV. Always good to have you, Pras Subramanian. Thank you so much.