Polestar Starts Production In US To Avoid High Tariffs Imposed On China-Made EVs

Swedish EV maker Polestar Automotive PSNY said on Wednesday that it has commenced production of its Polestar 3 SUV in the U.S.

What Happened: Polestar 3 production has commenced at a factory in South Carolina from where the company intends to ship it to both European and U.S. customers.

"Manufacturing Polestar 3 in the USA is a crucial step for us. Now we offer customers in America an electric SUV that is built in America. Exporting the South Carolina-produced Polestar 3 to Europe will strengthen our business on a broader scope,” Polestar CEO Thomas Ingenlath said in a statement.

Polestar is already manufacturing the Polestar 3 in Chengdu, China. Starting production within the U.S. will enable the company to avoid the increased tariffs imposed on EVs made in China by both the European Union and the U.S. government.

The Swedish automaker is also looking to start producing its Polestar 4 SUV coupé at a facility in South Korea starting mid-2025, thereby expanding its manufacturing capacities outside of China.

Why It Matters: Polestar, majority-owned by China’s Geely, delivered about 13,000 cars globally in the second quarter, marking a jump of 80% as compared to the previous quarter.

For the quarter ended March 2024, Polestar reported an operating loss of $231.7 million, as compared to the loss of $219.9 million reported for the corresponding quarter of last year.

The company is planning to have a line-up of five EVs by 2026, including Polestar 2, Polestar 3, Polestar 4, Polestar 5, and Polestar 6, an electric roadster.

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Photo courtesy: Polestar