Polestar in trouble, new CEO Lohscheller has to fix it

Polestar, the electric car brand of Geely and Volvo, announced the appointment of Michael Lohscheller as its new CEO. In October, he will succeed long-term CEO Thomas Ingenlath, who has held the position since 2017. The new appointment comes shortly after another significant change at the top of the board.

On on October 1st, Lohscheller will take over from Thomas Ingenlath, who has been in this role for seven years, i.e., since Polestar started operating as its own brand for hybrid and electric cars. Previously, Polestar was a tuning division of Volvo under the name Polestar Engineered.

The CEO change is apparently at Ingenlath’s request. Polestar announced that he resigned on October 1st, 2024. The Swedish-Chinese company describes his successor, Michael Lohscheller, as having “a wealth of expertise in the automotive industry, particularly in navigating competitive markets and scaling businesses.”

Job hopper?

Michael Lohscheller is a familiar face in the industry. The 55-year-old German previously worked at Mitsubishi and worked for Volkswagen in the US. He became CEO of Opel but left there when PSA, which bought Opel from GM, transformed into Stellantis.

Lohscheller then became CEO of the Vietnamese manufacturer VinFast and the American start-up Nikola. His passages there were… fast and short, to say the least, and didn’t leave an overwhelming feeling of being the right man at the right place. Now, he faces the massive task of relaunching a young brand in distress. Lohscheller was also head of the German Association for International Motor Vehicle Manufacturers (VDIK).

The new German manager’s task is thus straightforward: Polestar must expand its global presence in the coming years and secure market share in the premium electric vehicle segment. The carmaker currently offers three models: the Polestar 2, the Polestar 3, and the Polestar 4. Delivery of the last two to customers started very recently.

Changes at the top

The change of CEO comes just a few weeks after another change at the top at Polestar. In June, Winfried Vahland took over as Chairman of Polestar’s Board of Directors from former Volvo CEO Håkan Samuelsson.

Vahland came over from Volkswagen, where he was working for Skoda. Meanwhile, Polestar also attracted former Audi designer Philippe Römers as its new design director. The German influence in Polestar has increased.

Samuelsson was considered a great advocate of CEO Ingenlath. Thus, it is possible that the vacancies on the Board of Directors and in operational management are related.

As the new Chairman of the Board of Directors, Vahland now welcomes Lohscheller to the company. “Polestar has experienced an exceptional start-up phase, and with a broader model lineup, Michael Lohscheller is the ideal leader to guide Polestar in its next chapter,” Vahland commented.

“His deep industry knowledge, especially in driving operational excellence, developing a coherent product strategy, and strengthening the global market presence, will be instrumental in the next chapter of Polestar’s growth, he continued.

“With Scandinavian heritage, passion, and performance, Polestar will set new standards for future individual mobility. Geely remains deeply committed to Polestar’s success, and with Michael at the helm, supported by a dynamic leadership team, we are well-positioned for continued innovation and growth.”

“I am honored to join Polestar at such an exciting time in the company’s history,” Lohscheller replied. “Polestar has already established itself as one of the most desirable and innovative brands in the electric vehicle space. I look forward to working with the talented team to build on this solid foundation and accelerate our development.”

Applaud the departing

Chairman Vahland recognizes Thomas Ingenlath’s achievements as follows: “Thomas has been instrumental in shaping Polestar into the innovative and forward-thinking brand it is today, leading its transformation from a Volvo performance division into the only truly global premium electric vehicle brand, with an outstanding focus on design, performance, and premium qualities. We extend our deepest gratitude for his leadership.”

Ingenlath answered: “I am very proud of what we’ve achieved together in the last seven years. We envisioned an electric premium brand with performance and design at its core. And we made it; the dream became a reality: Polestar is the only truly global premium electric brand.”

“We just launched the Polestar 3 and 4, and we are producing on two continents. Thank you to everybody who has contributed so far on this journey; it was a lifetime experience to build up this brand with you all. I wish Michael and the team the best for the next chapter of Polestar,” he added.

In serious trouble

Although Polestar’s second-quarter deliveries were up from Q1, they were still lower than last year. Polestar delivered 13,150 vehicles in Q2, up 84% from the first quarter. Despite this quarterly growth, Polestar delivered 16% fewer vehicles between April and June than the 15,765 handed over in 2023.

In the first half of 2024, Polestar delivered 20,371 cars, down 27% from last year (27,841). Polestar said the lower car sales were primarily because of the absence of Hertz. As a result, Polestar’s revenue fell 26% in Q2 to $918 million.

Polestar posted a $541 million net loss in the year’s first half, up 59% from the $341 million net loss in H1 2023. As of the end of June, Polestar had $669 million in cash and equivalents. Despite the lower deliveries, Polestar said it’s seeing “strong momentum, especially in the US, Norway, and Germany.”

Polestar remains vulnerable for the moment. When it went public in 2022, a share was valued at $10 and eventually went up to $15. At that time, the company’s value was estimated at $20 billion; today, it’s $2 billion, and the share price struggles to stay above one dollar.

The company’s challenges are multiple. Until now, it depended too much on one model, the Polestar 2, a sedan in a world where SUVs are hot. With the Polestar 3 and 4, they’re finally arriving. Still, with a severe delay (partly due to software problems at Volvo) and the handicap, they are aiming at an electric market segment where competition is fierce, and prices are out of reach for many customers.

Furthermore, Polestar’s cars were previously produced only in China and will face a severe increase in import taxes in North America and the European Union. They will try to cure this by making the Polestar 3 in the US (in a Volvo factory) and the Polestar 4 in South Korea (in collaboration with Renault).