Polestar is staking its European future on a new production strategy that focuses on local manufacturing for regional markets. The Swedish electric performance brand, owned by China’s Geely, confirmed this week that its upcoming Polestar 7 will roll off the lines at Volvo Cars’ under-construction factory in Košice, Slovakia.
The 7 marks the premium brand’s first vehicle to be assembled in Europe and is the replacement for the current 2. Though hopes were also set on Volvo’s Ghent factory, Polestar has officially announced it will allocate the model to the group’s brand-new facility in Slovakia.
Single platform
Production of the compact battery-electric SUV is set to begin in 2028, which is later than anticipated. CEO of Polestar, Michael Lohscheller, mentioned that the model is a top priority, possibly predating the niche open-top model 6, which can do little to boost sales. Bringing Polestar to the masses is the task of the 7, which will take on rivals like the BMW iX1 and Mercedes EQA.
Production in Ghent would have been symbolic, as its main competitor, the BMW iX1, is Belgium’s top-selling corporate car. As Volvo is moving toward a single platform with component boxes to streamline efficiencies, the 7 shares most of its technology with the EX30 and the soon-to-be-released EX60.
Manufacturing in Ghent was feasible from a technical standpoint, but with the EX30 added as its latest model, the factory is nearly running at full capacity.
However, the market changes fast, and overcapacity looms for Volvo. The Slovakia plant was constructed to boost annual sales to 1.2 million units, but the recent earnings call unveiled that the Swedish brand is falling short. This year, the revised target is 800,000 units.
250,000 units
The new Slovakian plant, scheduled to be operational next year, has a capacity of up to 250,000 units per year. The full line-up to be built over there hasn’t been disclosed yet. The Košice site is Volvo’s third European factory, after Torslanda in Sweden and Ghent.
Industry watchers say its low-cost structure and proximity to key European markets make it an ideal hedge against overcapacity as Chinese automakers and legacy brands expand aggressively in Eastern Europe.
Polestar is a light asset manufacturer and doesn’t own its production facilities. The current 2 is built in China, together with the 4, though the latter is also manufactured in South Korea at a Renault-Samsung factory. The 3 runs off the assembly line from Volvo in Charleston, US, as in China.
Polestar is diversifying its production footprint to undercut levies from different regions. These are 28.8% in Europe, and more than 100% when shipping to the US. Polestar has been particularly vulnerable compared with rivals like BMW and Mercedes-Benz, which already manufacture significant volumes in Europe.
“Working with Volvo Cars to develop and manufacture Polestar 7 in Europe is a unique opportunity that will strengthen our position in our home market,” CEO Michael Lohscheller said in a statement.
Evolutionary design
The Polestar 7 will mark a significant shift toward greater integration with Volvo and Geely, as it transitions to the next-generation SPA3 architecture. Design-wise, the crossover is expected to build on the brand’s minimalist Scandinavian look, nothing radical, but with what new design chief Philipp Römers calls “a bit more confidence.”
Römers, who joined Polestar after designing for Audi and Volkswagen Group, said the 7 will sit between the EX30 and EX40 in size, targeting a sweet spot in Europe’s booming compact SUV segment.
“Compact SUVs are where the market is at, especially in Europe,” Lohscheller said. “It’s a big profit pool and a big volume pool.” The 7 must stake its claim in a segment that could finally help Polestar achieve the scale it has long promised but has yet to deliver.
