Polestar and Volvo face production delays for all-electric crossovers: Polestar 3 and EX90 launches postponed

Polestar and Volvo, both owned by China’s Geely, have officially announced a delay in the launch of their upcoming all-electric, three-row crossovers – the Polestar 3 and EX90.

The Polestar 3, which was originally scheduled to begin production in August, is now facing its second production delay. The new production start date has been pushed to the first quarter of next year due to persistent software issues associated with the vehicle’s platform.

Similarly, the EX90, which shares its platform with the Polestar 3, is also experiencing platform development challenges. As a result, Volvo has decided to postpone the production start for the EX90 from December to early 2024. Both electric crossovers will be manufactured in South Carolina.

Additionally, Polestar’s production output for 2023 has been reduced from the initially planned 80,000 units to 60,000 units. This adjustment is a response to the current economic climate and uncertainties in the market.

Polestar’s CFO, Johan Malmqvist, stated that it would be challenging to compensate for the absence of Polestar 3 volumes with increased Polestar 2 volume.

The decision to lower sales estimates aims to maintain a balanced approach between volume, profit margins, and price stability for their products, according to CEO Thomas Ingenlath.

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While protecting the profit margin of the Polestar 2 is a priority, delaying the Polestar 3 presents another issue – a lack of inventory for Polestar dealerships.

Currently, these dealerships solely rely on the Polestar 2 for sales, as the Polestar 1 plug-in hybrid has been discontinued. This situation has caused concern and stress among dealerships, as the Polestar 2 does not cater to the growing SUV market demand.

On the other hand, Volvo dealerships have a more diverse lineup of vehicles, including the XC90, the predecessor of the EX90.

Thus, they are better equipped to handle the delay. However, customers who have already placed orders for the EX90 will have to wait longer for delivery, as the initial round of order books has already closed.

The production delays and reduced output indicate the challenges faced by Polestar and Volvo in meeting market demands and ensuring product quality.

While the delays may cause inconvenience and disappointment for customers and dealerships, the companies are focused on finding solutions to overcome the software and platform issues and deliver high-quality electric vehicles to the market.