Volvo hopes to take on Tesla in China’s electric car market

Volvo, the Swedish car maker owned by Zhejiang Geely Holding, has joined the fray to tap China’s buoyant new-energy vehicle market by announcing its plans for the new Polestar brand.

The company unveiled its Polestar 1 model in Shanghai on Tuesday night, a luxury four-seater hybrid coupe expected to hit the market in 2019.

Volvo and its Chinese parent formed a joint venture to support Polestar’s development and pledged investment of 5 billion yuan (US$755 million) into high-performance electric cars, following their combined efforts to build mid-priced cars under the Lynk brand.

They will set up production facilities in the western Chinese city of Chengdu, capital of Sichuan province, to build Polestar-branded coupes and sport-utility vehicles (SUVs).

Their aim is to grab a sizeable share of the electric-car segment currently dominated by Tesla.

Thomas Ingenlath, chief executive of Polestar, said that the brand would have different types of vehicles, ranging from small cars that will compete directly with the Tesla 3 to high-performance models aimed at car lovers and collectors.