Polestar will sell 65,000 of its battery-electric vehicles to rental company Hertz Global Holdings during the next five years in a deal estimated to be worth more than $3 billion.
The announcement marks another step into the alternative energy space for Hertz, coming months after the rent-a-car company laid out plans to purchase 100,000 EVs from Tesla.
“Today’s partnership with Polestar further builds on our ambition to become a leading participant in the modern mobility ecosystem and doing so as an environmentally-forward company,” said Stephen Scherr, Hertz CEO.
Accelerating EV adoption
“By working with EV industry leaders like Polestar,” Scherr added, “we can help accelerate the adoption of electrification while providing renters, corporate customers and rideshare partners a premium EV product, exceptional experience and lower carbon footprint.”
The tie-up with Hertz is a potentially substantial move for Polestar, an EV startup owned by Volvo Cars and its Chinese parent, Geely.
The brand dates back to 1996 when it started out as an independent racing company. It was purchased by Volvo in 2015, with the original goal of serving as a high-performance sub-brand similar to the BMW M and Mercedes-Benz AMG marques. In 2017, however, Polestar shifted direction, focusing on battery-electric vehicles as a standalone brand.
Last September, Polestar announced plans to go public through a merger with SPAC, or special purpose acquisition company, Gores Guggenheim. The deal is expected to be completed later this year.
Polestar has big growth plans
The tie-up with Hertz will provide the new entity with a base of orders averaging 13,000 vehicles annually for the next five years. That would be nearly half of the 29,000 vehicles the Polestar brand sold worldwide in 2021. But the company expects to grow substantially during the coming years.
In a statement released Monday morning, Polestar noted it tripled sales in 2021 and “anticipates more than doubling volumes again this year,” with a target of 290,000 sales annually by the end of 2025.
“Polestar is committed to accelerating the move to electric mobility with a fascinating and innovative product portfolio,” said Polestar CEO Thomas Ingenlath. “The partnership with a global pioneer like Hertz will bring the amazing experience of driving an electric car to a wider audience, satisfying a broad variety of our mutual customers’ short- and longer-term mobility requirements. For many of them it may be the first time they have driven an EV, and it will be a Polestar.”
Deal could be worth $3 billion
The new partners did not reveal specific details about the planned purchase. Currently, Polestar offers only one model, the all-electric Polestar 2 SUV. At a base retail price of $49,000, the deal would be worth more than $3 billion — though rental firms have traditionally received discounts when making large purchases from other automakers.
Polestar previously laid out plans to expand its line-up with several other models, starting with the Polestar 3 coming in 2023. It is expected to be a low-slung crossover borrowing heavily from the brand’s Precept concept vehicle.
Until recently, travelers and others hoping to rent an electric vehicle had to turn to specialty firms. Hertz now is building a major fleet of EVs, starting with the 100,000 vehicles it will take delivery of from Tesla. The initial deal, announced last October, was centered around the automaker’s Model 3 sedan. Hertz said last month that it also would take delivery of some Tesla Model Y SUVs.
Source: The Detroit Bureau Read More