• Polestar has shut down its final direct store in China, transitioning primarily to an online sales model in the country.
• Polestar said it is strategically adjusting its business model in China to better align with the diverse and rapidly evolving consumer demands of the Chinese market.

Polestar (NASDAQ: PSNY), the premium electric vehicle (EV) maker owned by Geely Holding and Volvo Cars, has closed its last remaining direct-sales store in China, located at L+ Plaza in Shanghai's Qiantan area, according to a report today by local media outlet Lanjinger.

Polestar is strategically adjusting its business model in China to better align with the diverse and rapidly evolving consumer demands of the Chinese market, the company said in a response.

"While the Shanghai store is temporarily closed, Polestar's other operations in China remain unaffected, and owner benefits will not be impacted," the company said.

Polestar currently operates primarily through an online sales pattern in China, the report cited a service representative as saying.

Spun off from Volvo's performance division, Polestar announced its independence as a high-performance luxury brand in 2017, jointly established by Volvo and Geely Holding.

In February 2024, Volvo announced plans to transfer 62.7 percent of its about 48 percent stake in Polestar to Geely Holding. Following the reduction, Volvo's ownership in Polestar decreased to 18 percent, while Geely Holding became Polestar's largest shareholder.

In June this year, Polestar announced a $200 million equity investment from existing investor PSD Investment Limited, which is effectively controlled by Eric Li, founder and chairman of Geely Holding.

Following the transaction, Volvo's stake in Polestar decreased from 18 percent to 16 percent.

In China's fiercely competitive EV market, Polestar has been marginalized, with its sales figures never appearing on any rankings.

On August 1, local media outlet National Business Daily reported that Polestar may completely exit the Chinese market by the end of this year.

The report noted that Polestar sold only 69 vehicles in China during the first half of the year, with no new car sales recorded in either April or May.