Polestar Joins EV-Tech Crossover With Made-for-China Smartphone

(Bloomberg) — First, Chinese carmaker Nio Inc. released a smartphone. Then tech giant Xiaomi Corp. launched an electric vehicle.

Now, Swedish-origin automaker Polestar is joining the fray with its own phone for the Chinese market, where high-tech and highly connected offerings are popular with drivers.

Unveiled at a glitzy event in Beijing Tuesday ahead of an auto show in the Chinese capital that kicks off April 25, the phone is jointly developed by Polestar Automotive Holding UK Plc’s design team in Gothenburg and Chinese smartphone maker Xingji Meizu Group. Both companies are controlled by billionaire Li Shufu’s car conglomerate Zhejiang Geely Holding Group.

The phone will run on an operating system adapted from Xingji Meizu’s Flyme Auto that can connect seamlessly with Polestar’s EVs. Messaging, calls, music and videos from the device can be displayed on the in-car dashboard. Starting from 7,388 yuan ($1,019), the phone comes with as much as 1 terabyte of storage and a 50 megapixel camera.

“Nio’s William Li said they’re launching a phone as a defensive measure due to Huawei and Xiaomi starting to make cars. I agree with him,” Xingji Meizu Chief Executive Officer Shen Ziyu said in an interview. “We also need our defensive measure as the auto industry incorporates more intelligent technologies and consumer electronics.”

Polestar Joins EV-Tech Crossover With Made-for-China Smartphone

The line between automakers and tech companies in China is starting to blur as vehicles increasingly come equipped with voice control, large dashboards and advanced driver-assistance systems. So far, it’s largely Chinese companies that have seen their ideas through to production, including Huawei Technologies Co.’s range of EVs that run on its operating system and link automatically to its devices.

Other well-known names have struggled. Apple Inc. earlier this year abandoned its decade-long effort to build an electric car, though is looking to push into personal robotics. Alphabet Inc.’s Waymo operates robotaxi services in some US cities but doesn’t produce its own vehicles.

Polestar’s foray into smartphones comes as it struggles with sluggish auto sales. It delivered 54,600 vehicles globally last year, short of its target of 60,000, and is eliminating about 450 jobs to cut costs.

Polestar Joins EV-Tech Crossover With Made-for-China Smartphone

Geely earlier this year bailed out Polestar to relieve financial pressure on another company it owns — Volvo Car AB. The brand is facing cut-throat competition in China, where manufacturers are heavily discounting prices and overall growth is slowing from the blistering pace of recent years.

Polestar is relying on new models to bolster sales, and earlier this year raised almost $1 billion in debt to support the roll out. Deliveries of the Polestar 4 coupe and Polestar 3 sport utility vehicle are due to start this year. A third car, the sporty Polestar 5 that’s to compete with Tesla’s Model S and the Porsche Taycan, will launch next year.

–With assistance from Stefan Nicola.

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