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Polestar to make new SUV in Europe from 2028
Published by Global Banking & Finance Review®
Posted on July 3, 2025
2 min readLast updated: January 23, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on July 3, 2025
2 min readLast updated: January 23, 2026
Polestar will produce its new SUV in Slovakia by 2028 to mitigate tariff impacts and expand its European production footprint.
By Marie Mannes and Anna Ringstrom
STOCKHOLM (Reuters) -Polestar said on Thursday it would make its Polestar 7 SUV model at a Volvo Cars factory in Slovakia, as the EV maker shifts more production from China and tries to cut its exposure to heavy European and U.S. tariffs.
Polestar said the two Swedish companies, both controlled by China's Geely and its owner Li Shufu, had signed a memorandum of understanding and the new model would launch in 2028.
"Polestar is taking the next step in diversifying its contract manufacturing footprint by expanding it to Europe," the company said.
Volvo's Kosice factory in Slovakia is scheduled to start production in 2026, with an expected annual capacity of 250,000 cars.
Polestar, which has yet to make a profit, faces tariffs of 28.8% for the cars it brings into Europe and more than 100% for any it imports into the United States.
The European Union imposed tariffs on Chinese-made EVs last year because of what it describes as unfair subsidies from the Chinese government. Beijing refutes this criticism.
Tariffs have impacted Polestar more than most European automakers because the majority of its cars are produced in China, either by Volvo Cars or Geely.
The automaker now produces some Polestar 3 SUVs in the United States at a Volvo Cars plant in South Carolina.
Earlier this year, the company stopped taking new orders from U.S. customers for the Polestar 2, which is still made in China.
The automaker will also export the Polestar 4 to the United States from a South Korean plant, where production is set to begin in the second half of the year.
Earlier this year, Polestar said it would take longer to become profitable and delayed its expansion of sales to additional countries.
(Reporting by Marie Mannes and Anna Ringstrom. Writing by Nick Carey. Editing by Mark Potter)
Polestar will manufacture its new SUV model, the Polestar 7, at a Volvo Cars factory in Slovakia.
The Polestar 7 is expected to launch in 2028.
Polestar faces tariffs of 28.8% for cars brought into Europe and over 100% for imports into the United States, significantly impacting its operations.
The Kosice factory in Slovakia is scheduled to start production in 2026, with an expected annual capacity of 250,000 cars.
Earlier this year, Polestar stopped taking new orders from U.S. customers for the Polestar 2, which is still made in China.
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