VOLVO has signalled major changes ahead for its retail operations in Australia with the Polestar and Lynk & Co brands both set to arrive in the next few years.
The three brands are part of China’s biggest privately owned car-maker, Geely Automobile, and discussions are underway as to how Polestar and Lynk & Co – all with models based on the same global platforms underpinning Volvo’s latest cars – will be represented here.
Volvo Car Australia’s new managing director Nick Connor, who was the inaugural chief executive of Polestar, has confirmed to GoAutoNews Premium that the high-performance electrified vehicle brand will launch here in 2020 with the Polestar 2 compact sedan.
This will be followed by the Polestar 3 mid-size SUV due around 2022.
The more budget-oriented Lynk & Co is still to be confirmed for Australia, but Mr Connor said it was safe to assume the brand will come here as part of Geely’s plan to launch in all major markets.
Its range includes the 01 mid-size SUV, 02 small SUV and 03 sedan, with regular petrol-engine versions to be produced in China and electrified variants built in Europe at Volvo’s Ghent factory in Belgium.
European sales, including the UK, will start in 2020.
Asked whether Polestar cars would be sold through Volvo dealers, dedicated standalone stores or an online sales channel, Mr Connor said: “Possibly all of the above.
“The primary offer for Polestar will be direct supply, but the Volvo dealers will have a role in that.
“Exactly what that role is, is still to be confirmed in certain markets. But I think it’s a car that you should be able to buy physically from a Polestar store or online, on the internet, and primarily it’s going to be offered through the subscription service.”
This is similar to the ‘Care by Volvo’ subscription service already in place in overseas markets and which Mr Connor is planning to roll out in Australia within the next two years (see separate story).
Customers sign up for two or three years and pay a flat monthly fee for what Polestar describes as a “no-deposit, all-inclusive subscription model” which provides a range of connected and on-demand services such as pick-up and delivery servicing and covers sundries like insurance and maintenance.
At the end of the term, customers will have the opportunity to purchase the vehicle outright or take out a subscription on another car.
Mr Connor said: “Primarily the offer will be: ‘Here’s a subscription service. It’s all in. It’s servicing, it’s maintenance, it’s insurance. You just need to plug it in and charge it up and go.’
“Certainly, dealers will do service and maintenance on the cars, and we are still to determine what the dealer’s role will be in that subscription model, but, frankly, the subscription model lends itself to online activity. So that will be the primary route to market.
“It really is a pain-free ownership proposition for the customer.”
Asked about the retail model for Lynk & Co, Mr Connor said “there’s ongoing debate about how it’s done”.
“The Lynk & Co (retail) model is primarily a direct-supply online sales channel with a subscription service similar to Polestar, so that’s their route to market,” he said.
“I think there will be a role for Volvo dealers working with Lynk & Co in the future.
“Exactly what that role will be is still to be finalised, but I think the cars will come here, they’re going to need service and maintenance, someone needs to do that, we share the CMA platform with Lynk & Co, so I think it’s fairly obvious that there’s common sense in Volvo dealers looking after Lynk & Co products.”
Mr Connor also said he was confident Volvo, Polestar and Lynk & Co could all operate comfortably in Australia, with cross-shopping encouraged given the separation between the three brands.
“If you look at what VW do with Skoda and VW and Audi, they do that pretty well in terms of brand management, so we wouldn’t be the first manufacturer to have a family of cars at different price points in the marketplace,” he said.
“There will always be some risk of cannibalisation, but the idea is that the Lynk & Co offer will be different from the Volvo offer, which will be different from the Polestar offer.
“So I think we have to look at it from a slightly broader perspective and say that we are owned by the Geely group. Geely has got ambitions – I’ve heard (chairman) Li Shufu talk about Geely becoming the ‘Volkswagen Group of China’ and I think that’s the right approach.
“Yes, we’ll have group cars. Does that mean we might get some cannibalisation between the brands? Yeah, I think that’s inevitable.
“But if it’s for the greater good then so be it and I think the challenge for Volvo and the challenge for Lynk & Co and the challenge for Polestar is to make sure that we carve out our own particular niche in the marketplace and we position ourselves correctly to our right customer base.”
By Terry Martin