Polestar's operations in China are experiencing a decline.
In the world of electric vehicles, Polestar continues to make waves with its innovative models and global ambitions. Despite a recent stagnation in its Chinese operations, the brand is pushing forward with its plans, focusing on expanding its product range and entering new markets.
Starting in 2026, Polestar will produce its compact SUV model, the Polestar 7, in Europe, specifically in Slovakia. This move is part of the brand's strategy to establish a stronger foothold in the European market.
The brand has also announced two new models: the Polestar 6 Roadster and the Polestar 5, a four-door GT model. These announcements suggest Polestar's commitment to diversifying its product range and catering to a wider audience.
However, Polestar's operations in China have seen a significant contraction. The brand has halted online sales and test drives, with appointments required for test drives. Polestar's China CEO, Wu Huijing, has stepped down, and Hu Shiwen has taken over the position.
Reports suggest that Polestar may withdraw from China by the end of the year, but the company denies this and claims to be restructuring its sales approach rather than abandoning the market entirely. The brand maintains only one sales presence in Shanghai, and sold just 69 vehicles in China during the first half of 2025.
Financially, Polestar has received a $200 million financial injection from PSD Investment Limited in June 2025, which has increased Li Shufu's stake in Polestar to 66 percent, further solidifying Geely's dominant role in the brand. Volvo Cars Group reduced its stake in Polestar to 16 percent in the same month, distributing the shares primarily to its shareholders, including Geely.
Despite the challenges in China, the Geely brand achieved a global sales increase of 51 percent in the first half of 2025, reaching 30,300 vehicles. The expansion of the model range and entry into new markets, such as France, are factors contributing to the positive global development of the Geely brand.
In conclusion, Polestar's China operations are currently under review, with a potential strategic restructuring or full exit by year-end 2025. However, the brand remains committed to the Chinese market and is investing heavily in expanding its product range.
- Polestar, in its bid to expand its product range and enter new markets, plans to invest heavily in technology development for the upcoming Polestar 6 Roadster and Polestar 5.
- The European production of the Polestar 7, set to begin in 2026, is a testament to Polestar's continued embrace of advanced technology and its ambition to establish a stronger presence in the European market.
