Polestar targets profits for 2025, confirms 7 will be a compact SUV

Swedish and Chinese electric vehicle maker Polestar has shared an updated business strategy, eyeing 2025 and beyond as its next chapter of growth. According to the press release detailed below, Polestar expects an increase in sales volume, especially as its long-promised Polestar 5 GT is expected to be launched this year. Additionally, the automaker confirmed that its Polestar 7 model will be a compact SUV and its most affordable BEV to date.

Polestar remains a growing name in the electric vehicle segment, and more people are becoming aware of the Geely-owned brand as it releases more models. Its two most recent were the Polestar 3 SUV and the 4 crossover, built in the United States and China respectively. According to Polestar, these two models experienced “strong product momentum,” accounting for 56% of orders in the fourth quarter of 2024.

Polestar looks to ride this wave until 2025 and adds momentum with the launch of the Polestar 5, a sports sedan based on the automaker’s EV Precept concept that targets up to 884 hp and will attempt to compete with some of the big guys, like the Tesla Model S and the Porsche Taycan.

Although not part of Polestar’s 2025 launches, executives from the automaker have divulged new details about a new model called Polestar 7, which was revealed in April 2024.

The Polestar 7 will replace the 2 as entry-level model

According to a statement on its investors page, Polestar expects a successful 2025 that will allow the city to implement its revamped business strategy until at least 2027. According to the automaker, it is targeting compound annual retail volume growth of 30-35% over the period. the next three years and positive adjusted EBITDA in 2025. Additionally, Polestar executives expect positive free cash flow after investments in 2027. Michael Lohscheller, CEO of Polestar, explained:

With Scandinavian design, performance and a premium brand, Polestar has successfully positioned itself in the global automotive market. We have three exceptional cars on the road and a passionate and growing customer base. We build on the strong Polestar brand, focused on design and performance.

But significant changes are needed to make this well-respected, progressive brand a successful and viable business. We are accelerating our business expansion and business transformation, while adjusting our future model lineup and significantly reducing our cost base. Both in terms of volumes and financials, we expect 2025 to be the strongest year in Polestar’s history.

Part of Polestar’s success in 2025 will depend on the start of sales of the Polestar 5, the automaker’s first model to be installed on an 800 V platform. According to the company, this launch is expected in the second half of this year. Until then, Polestar will continue to drive sales of its current range, consisting of the Polestar 2, 3 and 4.

If the Polestar 2 will be remembered as the BEV that made the brand known, its days are unfortunately numbered. Former Polestar CEO Thomas Ingenlath said the company intended to phase out both sedans around 2027 and that its successor would be a new model called Polestar 7.

Since then, we haven’t heard much about the Polestar 7, but the company confirmed today that it will arrive as a premium compact SUV. In addition, we have learned that the Polestar 7 will be the brand’s first model built in Europe. With production sites in China, South Korea and the United States, Europe is a natural next step for expansion, especially for a compact and affordable SUV that the Polestar 7 promises to be, as this is a very popular segment in the EU.

The Polestar 7 will also represent a new design strategy for the automaker. From this launch, it will “gradually move from a cross-platform approach to a single architecture, thereby reducing complexity, costs and investments”.

While we’ve learned what the Polestar 7’s BEV styling will be, we don’t know much else at this point. Hoping nothing comes to market until 2027 at the earliest, our immediate focus will remain on the upcoming launch of the Polestar 5 in 2025, followed by the Polestar 6 roadster convertible in 2026.