Polestar suffered badly financially in 2024, but the brand is starting the year under a new CEO with a plan that involves, among other changes, acknowledging that even EV start-ups need to embrace some of the more time-proven ways of operating.

“A lot of things need to change,” Michael Lohscheller told analysts on a call ostensibly to mark Polestar's delayed third-quarter results but mainly to lay out the parameters of its reboot.

Lohscheller, a former CFO and CEO of Opel-Vauxhall, joined in October to replace Thomas Ingenlath.

With him comes a more laser-focused on actively selling cars profitably, rather than the more aesthetically driven ‘design and they will come’ ethos that previously guided the Geely-owned brand.

The changes “start with the sale and distribution side”, Lohscheller said.

Polestar initially followed Tesla’s lead with a direct-to-consumer approach, soft-selling cars either online or from minimalist 'Spaces' in high-visibility shopping areas. This fostered a usefully close relationship between customer and brand but was expensive and slow to shift metal. As competition hots up, however, Polestar is adopting a more aggressive approach by partnering with dealers better equipped to close the sale – something it calls ‘active selling’. 

In the jargon of retail, Polestar is shifting most countries to a ‘non-genuine agency model’, in which the dealer sells on behalf of the car maker but is additionally incentivised to increase sales, rather than just accepting their agent fee.

“You can really already now see that the orders are taking off,” Lohscheller said, citing a 37% increase in the fourth quarter.

The fact that Polestar is now selling the delayed 4 coupé-crossover and 3 large SUV to supplement the 2 liftback is also helping.

Polestar aims to grow its number of dealers across the 27 markets it sells from 140 to 200 by the end of the year with a medium-term target of 300. In the UK, it aims to jump from eight outlets to 20 in the next 12 months.

Launching in new markets wil also help keep the promise Lohscheller made to analysts that Polestar would grow sales between 30% and 35% between 2024 and 2027.

Last year, Polestar sales actually fell 15% to 44,851 globally, although it returned to growth in the last three months, with sales up 5.3% on the launch of the 3 and 4.

Despite its Chinese ownership and global footprint, Polestar is very much a European brand when it comes to sales performance, and last year the UK was its biggest global market, with 8693 units.

The majority of those were 2s, but the 2 was beaten soundly by the new 4 in the final quarter.

This year, Polestar will grow further in Europe. “2025 is all about France,” Lohscheller said. The brand is finally launching there after a prolonged legal spat with Citroën and DS over the similarity of its logo to theirs, which was resolved in 2022.

The higher-priced 4 and 3 will joined this year by the “halo” Polestar 5, a large sporty saloon that will rival the Porsche Taycan. This will further contribute to higher-margin sales as Polestar looks to erode its debt mountain and finally turn a profit. 

Having last year promised to be cashflow-positive (a measure of profitability) by the end of this year, Lohscheller told analysts that’s now expected in 2027.

Cost reductions are high on the new executive team’s to-do list as is burns through between $100 million to $120m per month.

“This is not a sustainable, neither an acceptable situation,” CFO Jean-François Mady said on the call. Mady is another newcomer, having joined last year from Stellantis.

In the nine months to the end of September, Polestar posted a net loss of $863m (£695m), more than the same period the year before. However, money spent developing new models will slow “quite significantly” following the introduction of the 3 and 4, Mady said.

This is despite the announcement of the new Polestar 7 compact SUV, expected around 2027.

Polestar is also looking to take cost out of building existing models, said Mady: “We are going to start working actively with our manufacturing partners and suppliers to reduce the cost of the manufacturing costs and bill of materials."

Under its ‘asset-light’ model, Polestar pays other Geely companies – including Volvo and Zeekr – to build its cars, potentially setting up tricky conversations.

The 2 is one car under scrutiny, said Mady: “We don't want to give up on Polestar 2 profitability. Our plan clearly is to attack the product cost."

Polestar has leveraged the global network of Geely and associated company factories to dodge the worst of the tariff barriers erected for Chinese EVs, for example building the 3 in Volvo’s US plant and the 4 in Renault’s South Korean factory. The 7, meanwhile, will be produced in Europe, potentially at a new Geely plant in Slovakia. The 2, however, will continue to be built in China, as will the 5 and delayed 6 sports car.

New premium brands have a tough enough time in Europe without the additional tariff barriers, but Polestar so far has managed to established a presence that, with the new changes promoted by an active new management team, could finally be leveraged into both sales and financial success.