Q1 2023 Polestar Automotive Holding Uk Plc Earnings Call
Speaker 1: You you F.
Speaker 2: Good day and thank you for standing by. Welcome to the Paul Starr Q123 Results Conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press...
Speaker 2: star one one on your telephone. You will then hear an automatic message advising your hand is raised. To we throw your question, please press star one on one again. Please be advised that today's conference is being recorded. I would now like to hand a conference over to your speaker today, Diana Flint. Please go ahead.
Speaker 3: Thank you operator. Hello everyone. My name is Borana Flint from Polestar Investment Relations.
Speaker 3: Before handing over to Thomas Sing and Lars, I'll see you and Johann Mountkrisch, I'll see you for their opening remarks. Follow our analyst and shareholder questions. I will handle some housekeeping points. I would like to remind participants that many of our comments today will be considered forward-looking statements under U.S. security laws and are subject to numerous risks and uncertainties that may cause post-off extra results to differ materially from what has been communicated. These forward-looking statements include but are not limited to statements regarding the future financial performance of the company, production and delivery volumes,
Speaker 3: financial and operating results, outlook and guidance, macroeconomic industry trends, company initiatives and other future events.
Speaker 3: For the looking statements made today are effective only as of today, and poster evidence takes no obligation to update any of its forward-looking statements. For a discussion of some of the factors that could cause our actual results to differ, please review the risk factors section of the annual report on form 20S, filed with the SEC.
Speaker 3: In addition, manager who may preference is to non- GAAP financial measures between the school.
Speaker 3: A discussion of why we use non-GAAP financial measures and information regarding the conciliation of our non-GAAP financial measures.
Speaker 3: With our most directly comparable GAAP measures , is an investor of the presentation issued earlier today.
Speaker 3: With that I like to turn the call over to Thomas. Please go ahead.
Speaker 3: I'd like to turn the call over to Thomas. Please go ahead. Thank you, Bayana.
Speaker 4: The first quarter was a good example of the team's hard work and commitment.
Speaker 4: We have achieved record first quarter deliveries.
Speaker 4: of 12,076 cars, up 26% year on year, and then there's a second quarter of this year with good commercial momentum.
Speaker 4: I would like to spend a few moments reflecting on what hasn't able this. The main thing that set poster apart as a brand. As the first quarter shows, we are in the middle of a period of strong growth, creating footprint across 27 markets that allows us to adapt our commercial operations to match supply and demand across the world.
Speaker 4: This is complemented by our stable production base with over 130,000 cast manufactured to date.
Speaker 4: We also have a well-balanced mix between retail and fleet customers. Our global partnership with HURT to supply 65,000 cars is working well. And with a significant numbers out there, this provides a fantastic opportunity for potential customers to experience our cars.
Speaker 4: Reflecting how we are ensuring as a business.
Speaker 4: We are starting to see our first repeat customers.
Speaker 4: This is a significant step for our young brand like us.
Speaker 4: as it reduces our reliance on only winning new customers.
Speaker 4: It also provides the foundation for our pre-owned business, creating another entry point for new customers.
Speaker 4: Recently, we introduced significant upgrades to POSTA II. And I'm happy to say that it remains one of the top selling bets in many markets across Europe , North America and Asia.
Speaker 4: The recently launched BST-230 Special Edition also pushes the boundaries of performance and has been very well received.
Speaker 4: Purses 3. I would design let electric performance SUV.
Speaker 4: had its debut in North America recently. Where it generated very strong interest.
Speaker 4: is successfully unveiled post-A4, the latest example of our design and performance capability a few weeks ago.
Speaker 4: We launched it in China and expect to start production in the first quarter.
Speaker 4: But we also received major interest around the world and we plan to start deliveries in other markets from mid-2024.
Speaker 4: In addition, design innovation, sustainability is what the poster brand represents.
Speaker 4: It is our focus across all parts of the business and we reduced our relative CO2 emissions per car sold by 8% in 2023, decoupling our emissions from sales growth. This is a foundation that we will continue to build Pulsar's premium luxury brand on.
Speaker 4: Now as you might have seen, what we've cast announced early today, that they need additional time to complete the software development for the new all electric platform, which is also the basis for our POSTA 3.
Speaker 4: This means that start of production in Chengdu, China is now expected in early 2024.
Speaker 4: Importantly, the start of manufacturing POSA3 in Charles, USA is still on track for mid-2024, and the adjustments to POSA3 does not impact POSA4 as they are based on different platforms.
Speaker 4: We also acknowledge the tougher economic outlook for the automotive industry.
Speaker 4: And due to both of these reasons, we have adjusted our 23 global volume expectations to a range of 60 to 70,000 vehicles.
Speaker 4: representing an annual growth rate of 16 to 36 percent, following record deliveries of 51,491 cars last year. We have actively managed our cost base since mid-2002, but we need to do more.
Speaker 4: And that's why we are intensifying our efforts, including putting in place a group wide hiring freeze and reducing our head count by 10%. We're doing this in a structured way across all our markets while safeguarding our programs.
Speaker 4: That's why we are intensifying our efforts, including putting in place a group-wide hiring freeze and reducing our head count by 10%. We're doing this in a structured way across all our markets while safeguarding our programs. These next necessary actions.
Speaker 4: We'll benefit our cost base this year and more so in 2024.
Speaker 4: Now, I would like to ask Johan to comment on our financials.
Speaker 4: like to ask Johan to comment on our financials. Thank you Thomas.
Speaker 5: Hello everyone and thank you for joining us today. It's great to see so many of you again on the call and on the webcast. During the first quarter of 2023 we have delivered 12,076 24
Speaker 5: cars globally, up 26% year-on-year, reflecting strong volume development in key markets, such as the US, Canada and the UK.
Speaker 5: We have entered the second quarter where the well-established global presence in 27 markets on four continents.
Speaker 5: and with over 140 sales locations and nearly 1,120 service points.
Speaker 5: Before moving on to quarterly financial highlights and to echo Thomas's points, I want to emphasize that we, the management, are extremely focused on positioning post-arprudently in order to tackle the near-term challenges.
Speaker 5: Arrising from later than anticipated, poll 3, start of production, and a tougher economic outlook faced by the automated industry.
Speaker 5: We will deploy marketing and sales support activities in order to continue to build as well as protect our brand value and to maintain our growth momentum.
Speaker 5: This will be compensated with intensified cost management efforts we are announcing today.
Speaker 5: As a reminder, and you have heard us say this before, we recognize the challenging macro environment we have and continue to operate in, and we started to take actions more than six months ago.
Speaker 5: We are pleased to see that those initiatives
Speaker 5: Started to come through in the numbers, especially in our operating expenses.
Speaker 5: However, this is not enough. And hence we are taking further steps to strengthen pole star in the near term and reduce the cost space by taking out around 800 rolls that were planned to be added this year.
Speaker 5: Taking us back to the 2022 base of around 3000 employees.
Speaker 5: We are undertaking a wide range of additional actions while at the same time safe guarding the development of post-R5 and post-R6.
Speaker 5: Moving to the financial highlights for the first quarter of 2023. Bremenu increased 21 percent from 452 million to 546 million, driven by higher polls to our two sales across major geographic markets and pricing increases on model year 23. Despite the price increases, revenue per vehicle decreased slightly, primarily due to a negative translation currency effect, as well as a negative channel and mix effect.
Speaker 5: This was partially offset by high-freight and input costs. Failing general and administrative expenses were down 11% at 189 million due to active cost management. Research and development expenses were up 11% or 4 million with continued product development for future vehicles and technologies. Operating loss decreased by nearly 60 million or 23% predominantly driven by the high-grows profit and active cost management.
Speaker 5: Moving on to cash flow. Cash used by operating activities for the first quarter of 2023 was 283 million.
Speaker 5: mainly driven by operating loss, higher level of inventory and trade payables payments. Cash use for investing activities was 131 million, primarily as a result of post-a-3 and post-a-4 intellectual property investments.
Speaker 5: Cash provided by finance activities was $323 million, reflecting short-term borrowings of $637 million, of which $300 million was drawn down from the Volvo of cars, shareholder loan facility.
Speaker 5: partially offset by principal repayments of 311 million. At the end of the first quarter of 2023, cash and cash equivalents stood at 884 million.
Speaker 5: With continued support from our two major shareholders, we are closely monitoring the market and exploring potential equity and death offerings to fund operations and business growth.
Speaker 5: Thank you again for joining.
Speaker 2: And over to the operator for live Q&A by the analysts and then we will answer top questions from shareholders. Thank you. As I reminder to ask a question, please press star 11 on your telephone and wait for your name to be announced. To we throw your question, please press star 11 and 1 again. Will we now take the first question?
Speaker 2: It's from the line of Stephen Fox from Fox Advisors. Please go ahead.
Speaker 6: Hi, good morning. Thanks for taking my question. First off, I was wondering if you could dissect the change in your vehicle forecast for the year a little bit further. I'm trying to understand how much you would relate to the macro. And then further, can you talk about pricing strategies for the rest of the year given?
Speaker 6: what's going on in the market in general and your prior strategies and then I have a follow-up.
Speaker 6: on in the market in general and your prior strategies and then I have to follow. So maybe I…
Speaker 5: Start.
Speaker 5: Start. Start the place here. Okay. I can show the. Okay.
Speaker 5: We mentioned that in the introduction the lower volumes compared to the previous guidance as a reflection of the combination of both.
Speaker 5: the later than originally anticipated delivers of the Poster 3 and the tougher market conditions. Now we haven't disclosed the breakdown.
Speaker 5: What we can say is that
Speaker 5: given the tough economic climate, it's difficult for us to compensate for the absence of the post or three volumes with incremental post or two volumes.
Speaker 5: That coupled with higher market uncertainties, what led us to call down the volumes and provide a range.
Speaker 7: And in terms of pricing. We have in the.
Speaker 4: of course of the next weeks the model year 24 starting of poster 2 and as we explained before the upgrade of tech
Speaker 4: the significant...
Speaker 4: feature increase and the better performance of this car in terms of range. We combined that with the increase of price with the poster too of this model here.
Speaker 4: feature increase and the better performance of this car in terms of range. We combined that with the increase of price with the poster to of this model here. This is.
Speaker 4: Again supported with our
Speaker 4: with our statement that of Cosby.
Speaker 4: see as well that our customers expect on one hand stability in our pricing and for that reason we will proceed with this. Obviously the
Speaker 4: Again, linking this to our volume corridor, I mean, one of the reasons why we are prudent and giving this corridor, because we indeed intend not to push.
Speaker 4: cars into the market for any price just to achieve a volume that we once announced but indeed give us the opportunity to maintain the right balance between
Speaker 4: for any price just to achieve a volume that we once announced but indeed give us the opportunity to maintain the right balance between the volume.
Speaker 4: that we achieve and what we achieve in terms of margins and price stability with our products.
Speaker 6: Great, that's really helpful. And then I was just curious, like when we think about the 27 countries you're in, there seems a lot that you can control in terms of branding and sales efficiencies. What is sort of the difference between, you know, a region where you're operating well versus one that's new and how you bring that up? What's the potential in terms?
Speaker 4: regional breakdown of our...
Speaker 4: I think it's pretty good example of what?
Speaker 4: advantage of this to have this, I call it a widespread of 27 markets because indeed there are, it's one thing that a new established market of course needs some time to develop its full potential. The other effect is that of course there are regional facilities happening in quarters like.
Speaker 4: incentive cuts in the country which of course naturally have a damping there in the interest of the customer for a moment. But if you have...
Speaker 4: a broad base. You can indeed compensate. And for that reason, for example, of course, in the Scandinavian and the Nordic countries, with quite a lot of them having incentive going away in this quarter, compensating that with exceptional goods sales in the UK, for example.
Speaker 4: of course that is indeed a very good effect of being that widespread.
Speaker 7: Great. It's all very helpful, caller. I appreciate it. Thank you. Thank you. Thank you.
Speaker 2: We will now take the next question.
from the line of we need dong from dodge bank please go ahead
Thanks so much for taking my questions. I appreciate that you're not breaking down the reasons for the reduced guidance between the push-out of post R3 and then the macro challenges. But maybe can you talk about the order trends that you've been uploading? Any sort of specific...
Strengths by region or weakness by region that we appreciate it. That's my first question. Thanks.
Yeah, we left 22 opposite with a very strong order book and we.
Indeed, still.
Have.
a solid order book that we are working down. Let's face it, bring customers to bring customers in order for them not waiting to long for them. And obviously the model year 24 will be an additional push for the positive sales and the.
the campaign waiting to roll out now when the cars and production. For that reason, we have...
good conviction in the potential to achieve our our our our say is we're supposed to to having said that again. Obviously the macro economics.
and our ambition to
and our ambition to maintain.
the pricing and the premium position of this car and not enter into the price well of course for that reason we have this prudent outlook. I mentioned a bit about differences in reasons in the beginning obviously there are
effects in the beginning of this year and in all the countries where you see people that.
knowing that the incentives in the beginning would not be in place anymore, obviously pushed their sales in December 2022, which of course helped us in 2022 December a lot. But for that reason, of course, the first quarter was weaker there and of course, the end of the quarter.
for normalization we expect this to become to to normalize in the Nordic countries.
for normalization, we expect this to become to to normalize in the other countries. We have as well.
started of course much more explaining and pushing the fact that
The purchase of a poster too in 2023 in the US we are a least program qualifies.
For incentives and for that reason, we see as well the pickup of
interest and order for the poster two in the US again after obviously the slowdown that we had in the end of 22 when the car for I call it now a short moment didn't qualify for the incentives. So that's another effect which of course makes us.
positive about their outlook for the positive orders.
Thanks, Doug. Very helpful. My fault is on the calls management site that the global freeze and in the 10% petal reduction that you just announced today. Can you maybe elaborate more on tightening and what parts of the business are managing that? And then maybe any...
more quantifiable and lifetangling as a result of the reduction. Thank you.
Yep, thanks very much. So as we've communicated, we're implementing a 10% headcount reduction, and that's often an existing base of around 3,300 employees. So this would then put us at 3,000 employees, which is the same level we ended last year.
and that we would then intend to keep through this year. So we're working through the specifics of the headcount reduction as it relates to the 300. You can expect to see those cost savings start coming through the SG&A during the second half of this year and then with the full one rate effect next year.
A view taken through the account, the reduction of the additional 500 planned headcount for the year. Then of course those costs.
you take into account the reduction of the additional 500 planned headcount for the year, then of course those costs are even higher.
But any sort of quantifiable sort of not saving from rate that we can think about?
But any sort of quantifiable sort of not saving from rate that we can think about?
We're still working through the specifics of that, uh, uh, we need, but of course, you know, you can use the 300, um, a proxy against those 300 and 300 reduction in headcount versus their actual numbers. I should also mention that we're also working on additional initiatives to drive out cost and to conserve cash in the company.
Such as trimming the development costs of certain car programs, efficiency gains with our commercial operations, where for example, we've seen improvements in the quality levels of the Polestar 2, leading to lower warranty repairs and a little bit what we touched upon before in regards to our 27 markets.
can improve the efficiencies there and how we operate it now that we're becoming more established. So those are examples of additional actions across the company that we're taking. Got it. That's very helpful. Thank you so much. Okay. Thank you. We will now take the next question.
It's from the line of Tobias based from Redborne, please go ahead.
Hi, good afternoon. Thanks for taking my questions. I was just wondering if we could return back to order intake. If I have to look at your balance sheet, advance payments from customers declined sequentially again. This time from 41 million now to 33 million, suggesting that gross new orders in the period.
may have been less than 12,000 units, which I get to find out if I am analysed is 12,000 units less than the bottom end of your guided corridor. Are you able to comment on how orders have trended yet to date and perhaps maybe what you are doing to stimulate new orders through the year? I have two follow ups with that.
Well, isn't that an indication just simply that we as well just simply are able to deliver faster to our customers. I mean, the order book has always two sides to it. Strong order book, yes, as nice as it is. It means as well that customers, of course.
especially in last year, I had to wait quite long for the delivery. This normalizing is as well what you read in these numbers that this, this indeed is shrinking, which for the customer might be a very, very good effect. So for that reason, don't interpret this number now over into interest going down.
That's fair.
Again, order intake is something that is across the regions varying and generally.
Again, order intake is something that is across the regions varying and generally in
in the first quarter in the automotive industry is generally of course as well.
less intense than you would have it in the second half of the year. And that trend this year we exactly see again happening that of course the...
The fatigues in January February is something that is spring picking up and yeah, this is effect we see in 23 again. And today is just on your face in the army, don't forget us, we communicated before, we do expect volumes to be weighted more towards the second half. And that's the case.
even with the absence of the POLSTAR III and part of that reason is also then on the back of the POLSTAR II model year 24 which we then anticipate will drive a higher growth.
Okay, cool. Thank you. My second question relates to the poll staff for. The indicative price that you announced that the Shanghai Auto Show of $60,000 given prior comparisons to the Porsche McCann was a little lower than I'd anticipated. Do you still think that the comparison
between poll star and Porsche makes sense. Or do you think investors should now think of poll star is attempting to disrupt BMW or Mercedes-Benz? Well, have you referring with the 60,000 and thinking is a bit low? I mean, it's,
You look at a company that with our direct sales business model has a very clear
pricing here where you don't go into our shop and
materialize is not that much comparable. So I think you have to put that a little bit into the equation as well if you compare this.
The 60,000 again it's
The car that probably does not have the performance pack and certain addition on it, so you easily can spec up this car. Having said that,
car that probably does not have the performance pack and certain addition on it, so you easily can spec up this car. Having said that, if you...
If you look at the comparison, it's very helpful for us to give that guidance for people to understand that the poster 4 does not directly compete with a Tesla Model Y, which where you would immediately say, oh, but isn't that car a little bit too expensive to compete with it. It is indeed much, much closer in its price range to the Porsche McCann, then it is...
to test some model Y. And I think it is very important for us to give that.
Tesla Model Y. And I think it is very important for us to give that guidance where to have cut this car into position.
Is it, I mean, we are our own brand. We are not out there to build the Porsche Macon copy. We are putting our product there, which is in a way something new. And again, that's where it is helpful for us to give a little bit of that positioning in order for people not mistaking it as a Tesla model Y competitor. OK, thank you. And just a quick point of clarification.
In the presentation.
at Autosang High. We actually were quite, I call it now explicit, about the price range that the poster for...
auto Shanghai. We actually were quite, I call it now explicit, about the price range that the poster for will
cover very early in this time already and indeed that was a price range for the poster for which was between 60 and 80.
$1,000. And I think that is where you pick the 16-hour very exclusively, I mean, this is a singular price point. So when you see that we actually, let me try to remember, it was I think $350,000 RMB to $540,000 RMB, you have to trace...
the next question.
It's from the line of Dan Levy from Barclays, please go ahead.
Hi, get afternoon to you. Thanks for taking the questions. I wanted to go back to the pace of quarterly volume. And maybe you could give us a sense. In the first quarter, if the 12,000 units of deliveries was that a function of demand, or was that just a function of the output at, I think we cow from the facility.
And was the guidance that you're providing to step up in volume? Is that just more so a function of output increasing, or was that just a function of sort of seasonality, more demand coming up?
online. I have you on help me then if I think it is a mix of both because indeed in the very beginning of this year we were indeed as well.
lacking the stock having sold lots of cars in the last quarter of 2022. So a certain degree of not being able to deliver more cars was as well because we didn't have that many cars in stock there. This is of course normalizing and not the case anymore because and funnily enough in this.
course for the first time. And we have not talked about supply chain issues, which I think is amazing. Because indeed, there are the supply chain issues indeed not a topic that much this year. So, yeah, this obviously will for the rest of the year not be the issue.
Seasonality indeed you mentioned it that again is an effect on the chemistry you would always in the quarter one and probably in the quarter two still have less
automotive business happening then in the quarters three and four. So indeed that will be exactly the same in 23 again. Yeah, I can only echo what Thomas said. A little bit of a tight supply going into this year. So a combination of the two done but on the go forward basing.
of the Modelia 24.
Got it. Okay. So, you're past the supply constraints and it's more function of demand. Thank you.
We got it, okay, so you're past the supply constraints and it's more function of demand, thank you.
Second, wanted to ask about the, let's go back to the pricing strategy. And I appreciate your comments about, focusing on your customers are looking for price stability, but maybe you can talk to how you think the macro plays into your.
pricing strategy, if at all? Well, the marker definitely plays in that. For example, the model mix, of course, customers are more price sensitive and would probably think twice if they add another package to it. So generally, the...
the average of what price we sell a Pulsar 2. Yes, that of course has an influence that.
people are in the environment more careful in spending money. Of course we have an influence from that side. And you saw an element of that than in the in the average selling price of Q1 actually that even though on the one hand.
It reflected the benefits of the prior price increases. Actually, it was overshadowed by a negative translation effect, but there was a small element of negative variant mixed effect to Thomas' point. So I think that's one example.
over that macro condition. Great, thanks. If I could just squeeze one more in, please. I know you mentioned that Polestar 4 is on a different platform than Polestar 3. And so that's why it's not going to be delayed, but maybe you could just remind us of maybe what piece.
customer facing side of, I call it now, the entertainment software is indeed
shared because the Android-based Google system is part of both cars, both for free and both for the customer. That's indeed one experience.
The Android-based Google system is part of both cars, both of three and both of four for the customer. That's indeed is one experience for...
And I would not nail it down now only to the electric platform, generally, because basically it's two different entities working on it. One contract engineer with one team, one contract engineer by another team, of course secures as well that the timing between the two cars.
is pretty much independent and we do not have knock-on effect of a PASA3 SOP onto the SOP that we would have with the PASA4. So it's not just due to it having a different electronic architecture.
independent and we do not have knock-on effect of a PASTA3 SOP onto the SOP that we would have with a PASTA4. So it's not just due to it having a different electronic architecture. Okay, thank you.
Thank you. Thank you. We will now take the next question. It's from the line of Andres Sheppard from Canto Futuro. Please go ahead.
Hi, good morning or good afternoon. Thank you for taking our question. Congratulations on the quarter. You know, a lot of our questions have been asked. Maybe I'm wondering, can you give us an update on how the plans for the next phase of the COVID-19 pandemic will
regarding the manufacturing in South Carolina is progressing. Is that still on track? Are there any updates there?
The update is that it's on track. The timing for the production in South Carolina to start producing Posta 3.
and again not only for the US but as well for export, has been in the middle of 2024 and it stays for that timing. So indeed for you.
We will start producing the poster free in the US in the middle of 2024.
Got it. Okay. That's very helpful Thomas. Thank you. And then maybe as a follow up, is it possible to quantify a little bit further the relationship with hurt, you know, in terms of how deliveries are going or kind of what's to be expected for either later this year or or next year just trying to get a sense of.
how we should be thinking about it. Thank you. In regards to Hertz, still according to plan with the 65,000 cars gradually being delivered over this five-year period, there was an initial tranche that was delivered in 2022, which then continues to build during 2023 before landing at a more different location than it's replication time.
level run rate as from next year and for the remaining volumes. So it's going to be a gradual build up.
before we get to more of a kind of stabilized run rate of the 65. Thank you. As a reminder, if you wish to ask a question, please press star 1 and 1 on your telephone.
It goes back to this topic of software. I think it's an important one. It seems a lot of people in the industry are struggling with it.
So basically, I suppose the main question is, can you summarize poll stars' philosophy with regard to software development and then maybe more broadly your partner's philosophy is both of GLE's philosophies with regard to software development? Do you think that any fundamental changes need to be made?
by the industry or by your company more specifically with regard to software in order to prevent delays to vehicle launches or other production disruption in the future. Thanks very much. Yeah, right.
I have to go back here a little bit to how the product put for you and what we call the asset light model of poll stars actually. What it's based on and from almost from day one was posted we had to explain.
I have to go back here a little bit to how the product portfolio and what we call the asset-like model of Polestar is actually what it's based on. And almost from day one with Polestar we had to explain our...
Our key thing is not to have that one thing where we build on and what we invest into and this is the base of everything. It's the opposite. We have...
key thing is not to have that one thing where we build on and what we invest into and this is the base of everything. It's the opposite. We have the access.
to different technology in the group and dependent on the type of car, the price point of the car, the technology that is needed for that, we pick and choose that technology. And for that reason, yes, there are different technology bases for the car.
our cars which we then for the customer experience of course tuned to become post us that were said the interface for the entertainment how you actually drive our car what are the functions that is of course what what is unified but
cars which we then for the customer experience of course tuned to become posters. That's where I said the interface for the entertainment how you actually drive our car what are the functions that is of course what what is unified but the
technology might differ underneath. And there are projects like the Pulsar 3 which obviously is very much at the pinnacle of innovative, great technology coming to the market with an electronic architecture which indeed will in the near future enable a LIDAR supported unsupervised highway piloting. I mean, this is obviously...
part of this architecture. And I would say, yeah, should I call it now, understandable reasons, but of course the complexity and the innovativeness of that platform is of course something that has to be handled.
Good this is of course the case now with the pasta3
Good, that we indeed have at the other hand at the same time the living proof of that.
Good that we indeed have at the other hand at the same time the the living proof of that spreading.
onto different technology basis actually has the advantage that you in a way de-risk as well the company because indeed there is no knock-on effect on the post-a-fall. It is in a way that independent development that there is no knock-on effect. That's where...
on to different technology basis actually has the advantage that you in a way de-risk as well the company because indeed there is no knock-on effect on the poster 4. It is in a way that independent development that there is no knock-on effect. That's where we've
On the other hand, see of course an incredible learning curve when you ask now what are the learnings and the consequences? I mean obviously
of course, incredible learning curve when you ask now what other learnings and the consequences. I mean obviously...
This big, big technology shift that is happening right now in the generally in the automotive world going into electronic architectures in the car, which of course are very different to what the kind of tree used to do in the past. Yes, there are some...
painful learning steps to be taken now, but I'm very sure that this will pay off in the future. We have already today in the POSA 2 great benefits of new technology with over the air updateability which we perform in this car and again
That was painful in the very first moments. The first half year definitely was a high learning cough required but look at it today. I mean we...
almost without big rollouts and over the updates with the Pulsar 2, this is not a topic anymore, it's just happening. So I think indeed what we see now with Pulsar 3 happening, yes, that's of course an initial hiccup, but I think the experience of Pulsar 3 is a very important one.
the technology that we reach with it and the learning that we do with it will generally be a very good foundation for a much smoother future in that. Okay, very good. Thanks a lot. I appreciate it. Thanks Alex.
Thank you. There are no further questions on the telephone at this time. I would like to hand back over to the speakers for shareholder questions.
Yeah right, we have some questions.
Yeah right we have some questions.
Yeah right we have some questions and Bojana was.
Bringing the top three voted questions together here and I have them in front of me and I would like to go through them. And we have question number one. Why has post-unlock invested?
In brand awareness in the US market, question mark, the brand is still not being considered as an alternative in numerous car comparisons and the vehicle technically exceeds many of its more popular competitors, question mark.
in the US market? The brand is still not being considered as an alternative in numerous car comparisons and the vehicle technically exceeds many of its more popular competitors.
statement of course is provoking me a little bit with has not invested in brand awareness um which i cannot confirm we have invested
heavily over the last years into the brand awareness of Polestar. And I have the need now here to fundamentally actually almost take the opposite because
The just looking very, very fact based on what brand awareness post-art achieves and now specifically in the US.
Just looking very fact-based on what brand awareness Polestar achieves, and now specifically in the US. Can people MonsterTopics
In a study that researchers aided brand awareness, we have improved a year ago when we had the big Super Bowl push and made that jump to a 10% increase in the number of people who have been in the industry for a long time.
brand awareness at that point in time. And when you see now a year later without a spectacular thing like Super Bowl but constant and permanent work with our marketing, with our communications, we have...
stepped up from this 10% to a 13% aided brand awareness. And now to put that into perspective, this 13%, if you compare that,
One of the competitors is very often mentioned then as kind of that much better than Polestar. Actually Lucid with 14.6% is very very close to this 13%. So the perception that we are limping behind in brand awareness in the US factually is actually much much less different than the felt lack of brand awareness of Polestar. Now I don't want to make that now like oh this is not a topic for us. Of course we want to improve and of course we want to improve brand awareness especially in the US and for that reason there are just now in this quarter, quarter two, a 20 million dollar marketing campaign in the second quarter in the US market active. And we have.
the Pulsar 3 TBC a very successful high engagement rate where spending actually much less than others achieving much more of action and response on that television of Pulsar 3. So I think it's a combination on one hand and of course spending money and doing something but doing it in a very, very efficient way and having lots of bang for the buck. And that means really high amount of customer activation and generating traffic on our dot com with these actions. So that's where I think the US market of course.
It will take as well time, it will take as well more cars, the POSA 3 and 4 coming to the market. Of course, this is very much needed. And on the other hand, the POSA space is with.
a significant amount being out there and covering, coming over this tipping point where you just simply feel the presence of the brand. Still building that up, but I want to say again we are not at all in that bad position as it's sometimes displayed. And to remind you as well, selling cars, I mean...
actually selling the Polestar 2 as an electric car and it's on fifth place in the sales statistic.
selling the Polestar 2 as an electric car and it's on fifth place in the sales statistic, just-
just to remind you of the success of the car in that respect being in front of Mercedes-EQS, Nissan LEAF, the Taycan and of course it was selling many more Polestar 2s. Second question picks up the similar topic but is a bit broader. How does Polestar...
Yes, this.
I call it now slightly limping behind the US market in brand awareness. If you put that in to the global perspective, us being in 27 markets out there and in many the overwhelming majority of this market having a much bigger distance to our PSL who to grind said we are compared to in terms of brand awareness.
or BYD was 4.5%. Now we have one measurement in Holland, in Netherlands. 41% brand awareness of post-doc.
3.8% of Lucid. I mean, to show what difference is in markets where we are very, very well established and strong. And then, compared to that, our difference in the US is not that big as it is in other countries where we're really exceeding very much the brand awareness of our peers.
So for that reason, I think that young and still small brand poster has actually quite a good starting point in order to of course still accelerate and build brand awareness in those markets. And again, all that has been achieved with this one poster too.
thinking that we will be in 24 in these markets with three products of COSETS as well, a complete different base. Question number three, we actually covered already with one of the questions before about the South Carolina plan and when it will start producing and again confirming that.
mid 24 is the timing for South Carolina production.
mid-24 is the timing for South Carolina production.
Yeah, closing remarks then from my side here. In 24, we will have that portfolio of three cars and it will include two electric SUVs, which obviously is very important because that's a fast growing segment in the EV space.
For Pulsar 3, the display cards will in the retail locations arrive by the end of this summer. And we will do a very, very nice ramp up of our marketing and customer engagement activities, because of course we want to build that strong order book for Pulsar 3 this year. The launch of Pulsar 4 creates a fast-Books in the Bigazz suite.OL and the new Pulsar 3. Notice how that intention will change by a certain rate and clouds.
is early in 2024.
Then.
The Posa 2 we will continue to build on the success of the car by Starting the customer deliveries for its model year 24, which of course a very important model Yeah upgrade with substantial tech upgrades
that you all know from poster three.
I remain, we remain confident that all of this will help us to deliver on the growth ambitions and of course as well to the path to profitability of poster. Yeah, thanks for joining this course. Thank you.
You you.