Electric cars are very trendy – but people haven’t bought quite as many of them as car companies like Tesla had hoped, especially in the last few months. There are many reasons for this, but the main one is the high interest rates, which drive up buyers’ loan payments.
Given the lukewarm adoption of electric vehicles, automakers – particularly those that also make traditional internal combustion engine cars, such as Mercedes Benz, Ford and Aston Martin – decided to slow production of electric vehicles until consumers are ready to buy them again.
The only problem? According to Thomas Ingenlath, CEO of Swedish electric vehicle maker Polestar, these competitors risk missing a closing window of opportunity that could turn in their favor at any time.
“There is an incredible threat and danger if you don’t embrace future innovations and don’t believe in this technology – the electric powertrains, the innovation in batteries, the innovation in advanced electronics and software,” Ingenlath says told The Telegraph in comments posted Saturday.
“If you don’t participate and think you can wait and customers are willing, that’s an incredible trap.”
Delaying production could be a losing strategy for some players in the electric vehicle market, but Polestar could benefit massively from it. Ingenlath said the company would not be as badly affected by a drop in demand because the Polestar 3 and 4 are desirable cars (the Polestar 5 is also due to launch later this year).
“It’s an incredible opportunity for Polestar that there actually isn’t that much competition in this premium performance car space,” he said.
Ingenlath’s comments come just days after those of the Swedish automaker Volvo car dumped Due to financial problems and low demand for electric vehicles, the company acquired a large part of its stake in Polestar.
Tesla’s Swedish rival has been making losses in recent years – a trend commonly seen among electric newcomers – and the so-called EV winter caused by falling electric car sales hasn’t helped Polestar, which recently launched a received award $1 billion financing package from a group of banks to keep it afloat.
Nasdaq-listed Polestar, whose cars are more expensive compared to Teslas, has struck a deal with used car dealer Hertz take care of his cars are not sold very cheaply or in large quantities. The automaker remains confident that the electric vehicle market will pick up again, which can boost its sales.
Polestar representatives did not immediately return calls AssetsRequest for comments.
Fear plays a role in postponing electric vehicle purchases
Polestar’s CEO’s assessment of fluctuating demand for electric cars is simple: it’s not necessarily economic pressures that are stopping people from buying electric cars. It’s actually their fear of switching from fossil fuel cars.
“To tell you the truth, I think so [it is about] Be open to innovation and future technology,” Ingenlath said of the trend that caused the decline in electric vehicle sales.
“I see far too many people who are hesitant and afraid of change. That’s just not a good recipe for the future.”
Ingenlath has a point – people aren’t ready to switch as they look for upcoming tech upgrades – but the lack of them cheaper models is also a reason that weighs on their decision.
Other big-name automakers have been hesitant in the current electric vehicle environment, and Ford said that will be the case reduce production one of its outstanding electric vehicles.
Luxury car maker Aston Martin has cited growing demand as a reason and has paused production of its first battery-powered electric cars until demand picks up in 2026, while German manufacturer Mercedes Benz has also revised its milestone to meet its sales target of 50% pure electric cars reach by 2030 by 2025.
Mercedes boss Ola Källenius thinks so It could take “many years” for the cost of producing electric vehicles and internal combustion engine cars to equalize.