The midsize Polestar 3 SUV, the latest Polestar model to hit U.S. shores, is distinguished with sculpted styling, a minimalist interior, and loads of tech. It also features a good amount of real-world range and, living up to the automaker’s sporty performance goals, great handling and plenty of power.
The rub: The 2025 Polestar 3 starts at almost $69,000 and can edge close to $100,000 in top performance trim with all the available options. It’s not for the multitudes who live on tight budgets.
Likely rivals for shoppers’ attention include electric SUVs from the likes of Audi, BMW, Mercedes-Benz, and Volvo. You could toss in models such as the Cadillac Optiq, Tesla Model Y, and Genesis Electrified GV70, but they really play in a different segment as compact SUVs.
Polestar offers the 3 in three “long range” powertrain choices with option packages to increase the tech, driver assist and comfort, and “gee, look at me” content. The base single-motor, rear-wheel drive version delivers, per the EPA, up to 350 miles of range. None of the competing high-end electric SUVs can match that, although none offer single-motor version, opting instead for 100 percent all-wheel drive lineups.
More powerful but less efficient dual-motor, all-wheel drive versions of the Polestar 3 come in two flavors. The base dual-motor trim boasts a segment-leading 315 miles of range, per the EPA’s rating system. Adding the Performance Pack option drops the Polestar 3 Dual Motor’s rated range to between 279 and 300 miles, depending on tire and wheel size. That’s in the ballpark with the 300-mile Audi Q8 e-tron, 307-mile Mercedes-Benz EQE SUV, 309-mile BMW iX xDrive50, and 310-mile Volvo EX9.
Sizewise, the Polestar 3 sits near the bottom of it pack. While its passenger cabin is roomy, the 3 overall is as much as 5.5 inches shorter than other premium and luxury mid-size electric SUVs. It sits mid-pack in cargo capacity, though, bested by the BMW iX and Audi but leading the EQE SUV and the Volvo EX90. Pricewise, the Polestar starts lower than any likely competitor.
The Swedish EV maker started life as an independent tuning shop for Volvo racers, then was absorbed by Volvo Cars, which has been owned by China’s Zhejiang Geely Holding Group since 2010. In 2017 Geely decided it wanted a stand-along EV makers in its stable to market performance-oriented but premium-level vehicles globally. Polestar was spun off from Volvo to be that company.
It is publicly traded, but a majority of its shares are held by Geely and Geely founder and CEO Li Shufu’s private PSD Investment. Volvo Cars also holds a stake.
Polestar’s first model, the limited production Polestar 1, was a sport coupe with a 600 horsepower plug-in hybrid powertrain and 52 mile all-electric range, the best in the business. It was sold globally, though in very small numbers, from 2019 through 2021 and won praise for its styling and performance. Only about 1,500 of the $150,000 cars were built and just 250 of them made it to the U.S.
The Polestar 2, a compact sedan-styled hatchback, launched in 2019 and still is sold in Asia and Europe. U.S. sales of the sporty 2 were curtailed this year in the face of stiff tariffs on vehicles imported from China, where it is built.
Polestar 3 went on sale in the U.S. earlier this year in dual-motor trim, with the single-motor version launching in April. Models sold in the U.S. are built alongside the Volvo EX90 at Volvo’s South Carolina assembly plant. The 3 will be followed later this year by the Polestar 4, a tall sedan styled midsize SUV that shares most of its powertrain, suspension, and interior with the 3. It will be built in South Korea.
A Polestar 5 sport sedan – the brand’s new flagship model – is slated for 2026 and will be built in South Carolina and/or South Korea. The Polestar 7 compact SUV aimed mainly for the European market and slated to be assembled there is scheduled next, to be followed by the Polestar 6, a 2+2 performance roadster with head-turning design.
Don’t expect to consistently get EPA estimated range from any Polestar 3 variant unless your accelerator foot is feather light, your driving style rather timid, and you avoid hilly or mountainous terrain and highway driving. Real-world range for most EVs runs 10 to 15 percent below EPA estimates with the variance depending largely on tire size, the weight of cargo (including people) on board, driving style, terrain, and the amount of high speed driving involved. We tested both the single-motor and dual-motor performance versions of the Polestar 3. Our experience is that it manages to stick pretty close to the estimates, running 10 to 12 percent short in most driving conditions.
In in our range test of a single-motor Polestar 3 with 21-inch wheels – the variant EPA rates at 350 miles – our 250-mile round-trip ride covered 140 miles of fast freeway driving in light traffic, plus 70 miles of ambling country lanes and 40 miles of mountain roads. We tried to keep within 10 mph of posted speed limits.
Per EPA’s estimate, we should have been draining the battery pack at a rate of 3.27 miles per kilowatt-hour (350 miles/107 kWh usable battery capacity). But country and mountain driving on the first leg of the trip was uphill most of the way, cutting efficiency to just 2.4 miles per kWh. That would have resulted in just under 266 miles of range had we kept going at that pace. We benefitted from an equal amount of downhill motoring on the way back, though, and improved efficiency for that part was a relatively thrifty 3 miles per kWh. For the entire round trip, average consumption was 37.3 kWh per 100 miles. That’s the equivalent of 307 miles of range – 12.2% under the EPA estimate.
We tested the dual-motor performance version of the Polestar 3 last fall on rain-slicked roads in the area around Jackson, Wyoming. An abundance of caution with someone else’s vehicle kept speeds down, but we did climb about 2,200 feet from Jackson’s 6,240-foot elevation to hit the pass through the Tetons into neighboring Idaho. Overall, we found real range on that trip was pretty much what EPA estimated for the performance version with 22 inch tires.
All versions of the 2025 Polestar 3 are two-row, five-seat electric crossovers. There’s a lot of Volvo under the skin and in the interior, but Polestar DNA is dominant in the 3’s design and chassis, suspension, and powertrain development.
Its aerodynamic looks derive from the Polestar Precept electric sedan concept that was unveiled in 2020. It’s built on an EV-specific platform developed by Volvo.
The rear-drive Polestar 3 starts at $68,900 under pre-tariff pricing. It has its own powertrain and suspension but otherwise is almost identical in looks and features to the dual-motor trims.
Standard features include 20-inch alloy wheels, panoramic glass roof, acoustic laminated windshield and rear window, auto-extending flush door handles, power rear liftgate with foot sensor, power adjustable and heated, auto-dimming, and folding frameless side mirrors. Inside are standard heated and power adjustable front seats with extendable thigh bolsters, ambient interior lighting, tri-zone heat-pump climate control, rear touchscreen for climate and seat heating controls, and a 10-speaker audio system.
If your regular driving conditions don’t require all wheel drive and you don’t mind taking a couple of seconds longer to hit 60 from a standing stop, the single-motor version makes a lot of sense.
The dual-motor Polestar 3 starts at $74,800. It includes all the single-motor variant’s standard features and adds more power, electronic all-wheel drive with torque vectoring, and air suspension with active dampers. The dual motor AWD with Performance Pack jumps to $80,800 and includes everything on the standard dual motor but adds a performance software upgrade that boosts horsepower and torque. It also gets 22-inch alloys with performance tires, special chassis tuning, and gold-color seatbelts, valve caps, and brake calipers.
The Plus Pack, priced at $5,500, adds a head-up display, power adjustable steering column, soft-close door mechanism, heated rear seats and steering wheel, heated windshield wiper blades, and a foldable rear cargo bay floor. Also provided is a 25-speaker Bowers & Wilkins audio system with surround sound, Dolby Atmos capability, and active road noise cancellation.
Available only with the Plus Pack at an additional $5,500 is a combination of animal welfare certified Nappa leather upholstery in three color choices and dark ash wood trim. The Performance Pack, at $6,000 and available only for the dual-motor variant, adds 22-inch alloy and performance tires, a software upgrade that boosts horsepower and torque, sport and performance tuned chassis, and gold-colored seatbelts, brake calipers, and valve caps. A $2,100 Pro Pack option for the single-motor and base dual-motor variants adds specially designed 21-inch wheels, gold-colored valve caps, and black seatbelts with a gold center stripe.
All Polestar 3 variants use a 111-kilowatt-hour battery pack (107 kWh usable capacity) installed under the floor in a so-called skateboard EV platform. For the single-motor version, the battery supplies a rear-mounted motor rated at 299 horsepower and 361 lb.-ft. of torque. Dual-motor variants get an additional motor for the front axle. Combined, they produce a total of 489 horsepower and 620 lb-ft torque. The Performance Pack boosts that to 517 hp and 671 lb-ft.
Polstar says the standard dual-motor version can zoom from zero to 60 mpg in 4.9 seconds. Adding the Performance Pack cuts that to 4.6 seconds – at a cost of $2,000 per tenth of a second. The single motor Polestar 3 get to 60 in a more leisurely but perfectly acceptable 7.5 seconds, per Polestar’s estimate.
In any configuration there’s a decent amount of power, which is good because the Long-Range Dual Motor Polestar 3 weighs in at more than 2.5 tons in its lightest configuration, and is just 120 pounds short of 3 tons at its heftiest. The single motor version is some 200 pounds lighter than the base dual-motor Polestar 3.
The single motor version gets steel coil springs, passive dampers, and a rear motor without torque vectoring. Steering calibration is also a little softer in the single motor model. In our test drive we found it to deliver a comfortable ride and compliant handling, but its suspension couldn’t compensate for rough roads and high-speed corners quite as well as the dual moor variants’ more sophisticated system.
Dual motor Polestar 3s get adaptive air suspension and a rear-biased, electronic all-wheel drive system with torque vectoring that lets the Polestar 3 put its power to the road quite effectively and sure-footedly. All versions get four-piston Brembo front brakes with single-piston Brembos in the rears and they handle the vehicle’s weight with aplomb. A one-pedal drive setting for the Polestar 3’s multi-stage regenerative braking reduces brake-foot fatigue in crowded traffic and can mimic a downshift when turning or carving up a twisty country road.
We didn’t find either version of the Polestar 3 to be unwieldly or unbalanced when tossed around mountain corners or while carving winding roads, but our preference was for the double-motor variants’ air springs and adaptive dampers.
The single motor Polestar 3 with optional 21-inch wheels and all-season tires is EPA-rated at up to 350 miles of range, dropping to 342 miles with the standard 20-inch tires and 333 miles with 22-inchers. Dual-motor versions are rated at 315 miles with 21-inch wheels, 310 miles with the standard 20-inch wheels, and 287 miles with 22-inch wheels.
Adding the performance pack gets up to 300 miles of range. The Performance pack with its standard 22-inch alloys and sticky performance tires drops the estimated range to 279 miles. While the smaller 20-inch tires should deliver less rolling resistance and thus more range than the 21-inchers, the 20-inch wheels are made of cast aluminum, which makes them heavier and thus slightly less energy efficient than the forged aluminum wheels used with the 21 inch rubber.
At a DC fast charger, the Polestar can replenish its battery pack at up to 250 kilowatts per hour, good for a 10 to 80 percent recharge in 30 minutes. For home charging, the Polestar, like its competitors, uses an 11 kW Level 2 charging system. With properly sized 240-volt equipment, the Polestar can take a battery from 10 to 100 percent in 11 hours. Both DC and Level 2 charging speeds are competitive in the segment.
Polestar 3 has a Scandinavian minimalist interior that would have been avant-garde had it been rolled out a few years ago, before the Hyundai Motor Group set the standard for modern minimalism with its Hyundai and Kia small crossover interiors.
In the Polestar 3, the dashboard is divided into a padded textile-covered upper section with a textured plastic or optional aluminum or wood-trimmed lower face, divided by a thin strip of LED lighting. The dash houses a 9-inch-wide digital driver information screen and a centrally mounted, vertically oriented 14.5-inch infotainment touchscreen that also serves as a control center for almost all vehicle settings and functions. The only physical switches and knobs are vehicle function and driver display control buttons – unlabeled - on the steering wheel, the shifter, and turn signal stalks on the steering column. A rotary controller for the audio system is located on the center console’s floating bridge.
Power-adjustable, sports-styled front bucket seats are set low to maximize headroom and are both supportive and comfortable. The 60/40 split rear seat sits higher than the front seats for improved lines of sight for rear occupants. The bench is divided into three molded seating positions, and while the middle position is narrow, there’s decent rear legroom even for center-seat occupants since below-floor batteries allow a flat floor with decent legroom.
The Polestar 3 has a small-for-the-segment primary cargo bay providing 17.1 cubic feet behinds the rear seats, which we’re told allows carrying along about 15 grocery bags or five airline carry-ons. In contrast, the BMW iX features more than twice the Polestar’s capacity at 35.5 cubic feet with the Mercedes-Benz EQE SUV offering 20 cubic feet. Things improve when the Polestar 3’s rear seat back is folded down as this boosts total interior cargo capacity to 49.8 cubic feet. That’s still the least of the competitive set, though, with the iX boasting 77.9 cubes of maximum interior cargo space that takes the lead.
There’s also a 1.1 cu.-ft. storage area, or “frunk,” under the hood. It’s not large enough to be of much use but will hold a portable charging cord that otherwise would take up open cargo space in the rear. Among likely competitors, the Audi Q8 e-tron has a 2.1-cu.-ft. frunk while the BMW iX and Mercedes EQE SUV do without.
Polestar says the “3” can haul up to 220 pounds on its roof and dual-motor versions can tow up to 3,500 pounds. That tow rating is adequate for a small utility trailer but comes in less than the 5,500 pound rating of the BMW iX or the 4,000 pound rating of the Audi Q8. The Mercedes isn’t tow-rated in the U.S. The single-moor Polestar 3 is rated to tow up to 2,000 pounds.
Polestar uses an Android Automotive operating system for its infotainment centers. We’ve found it to be one of the most user-friendly interfaces around, especially for those who prefer to use voice commands, which are executed in everyday language after a “Hey Google” wakeup call. The built-in Google Play Store makes downloading new apps to the system easy. There’s 5G connectivity available, along with Google Maps with a 3-year constant internet connectivity plan at no charge.
Connectivity is enhanced with four USB-C ports – two for each seating row – and a 120-volt outlet in the rear cargo bay. Wireless phone and Bluetooth phone connectivity are standard as are Android Auto and Apple CarPlay compatibility. If there’s a drawback to the infotainment setup it’s that it is also control central for almost all vehicle adjustments and functions. This requires drivers who like to adjust drive modes, cabin temperature, and the like while underway to shift their eyes from road to screen far too often.
Audio is handled with a 10-speaker system. A 25-speaker Bowers & Wilkins sound system with Dolby Atmos surround sound and headrest speakers is an option. Three external speakers broadcast a warning tone at low speeds so that pedestrians, cyclists, and others can hear the otherwise silent EV as its draws near.
As a new model on a new platform, the Polestar 3 hasn’t yet been crash-tested by the National Highway Traffic Safety Administration (NHTSA) or the nonprofit Insurance Institute for Highway Safety (IIHS). It has received a 5-star safety rating in the European NCAP crash test program.
Polestar 3 is equipped with an impressive array of advanced safety and driver assistance technologies, all integrated via a centralized computer running on software developed by Volvo Cars. The driver assistance and safety systems use a variety of imaging systems to monitor external surroundings and conditions, monitor driver alertness, and even report in-car movement to help prevent accidentally leaving pets or children in a parked car.
Standard safety and driver assist features on the 2025 Polestar 3 include front collision avoidance and mitigation with braking and steering assist, pedestrian and cyclist detection, blind spot and rear cross traffic alert, rear collision mitigation, and driver alertness monitoring. Adaptive cruise control featuring full stop-and-go functionality along with lane keeping and centering with lane departure warning are also standard fare.
The Polestar 3 stands out for its unfussy good looks, user-friendly operating interface, and sporty ride, though its cargo bay isn’t as useful as some because of the rearward sloping roofline.
We certainly hope Polestar’s challenges don’t prove fatal. It has lost money every year since it was spun off from Volvo, had to delay production of the 3 for almost a year because of software issues, and hasn’t yet managed to achieve widespread name recognition in the U.S. Still, its vehicles are world-class EVs and the Polestar 3 belongs on any premium performance SUV shopper’s must-test list.
An anti-EV narrative is emerging around battery electric vehicles in the U.S.: “the market is slowing” and “the EV tipping point is years away and may never arrive.”
Like many narratives, there’s an element of truth. EV sales aren’t increasing as quickly as a few years ago. And there are headwinds with the removal of some federal incentives that were pushing EV sales and charging infrastructure. But this misses a larger point we see in the McKinsey Center for Future Mobility’s annual Consumer Pulse survey. There is a lot of strength in the EV market, especially if you include transition vehicles like plug-in hybrids and extended-range EVs (EREVs).
What do the sales say? In the first quarter of 2025, automakers sold 374,841 electric vehicles in the U.S., including battery-electric vehicles (BEVs), plug-in hybrid (PHEV), and fuel-cell electric vehicles. That was 9.6 percent of the overall light-vehicle market. The two quarters before that, EV sales eclipsed 10 percent of the market. Year over year, EV sales increased by 9 percent, compared with a 5.6 percent for overall car sales.
This was a slower increase than the last few years, to be sure. In 2021, the EV market nearly doubled. In 2022 and 2023, it grew by 62 percent and 35 percent. On the other hand, just five years ago, EV market share was 2 percent. Now it’s 10 percent.
There are headwinds. U.S. automakers continue to struggle with making EVs profitable. Consumer EV subsidies will end Sept. 30. In the short term, we’re seeing a bump in sales as consumers who were on the fence rush to buy before the deadline. Over the longer term, there is going to be far less government support and funding for public infrastructure. That’s a challenge, but it also may make it more straightforward for private investors. Improving availability and reliability of public chargers will be up to them alone.
Yet, even with the US slowdown, the International Energy Agency predicts EVs will account for 40 percent of global auto sales by 2040, versus 20 percent in 2024. As longtime auto journalist Mike Colias says in his new book, “InEVitable: Inside the Messy, Unstoppable Transition to Electric Vehicles,” the forces pushing legacy automakers toward electrification – Tesla and the Chinese – aren’t letting up.
“As messy as the EV story is today, automakers can’t afford to rip up their EV strategies,” Colias says.
Perhaps the biggest determinant if EV momentum will see a resurgence is the availability of much more affordable EVs (like we see e.g., in China). Given the still high battery cost this is difficult, and with the subsidies going away that challenge just got bigger.
An important question is what’s next? Will the electric vehicle market forever be a niche, or is slowing sales growth a mere bump in the road?
According to our models, the U.S. policy changes will slow down rather than stop the shift to electric vehicles. We think the adoption curve could be pushed out by five years or more. Recent regulatory changes also give U.S. automakers more time to get EVs profitable and more powertrain flexibility to focus on hybrids, plug-in hybrids, and extended-range EVs. They will need to be adaptable, and they will need to spread capital investments across multiple electrified powertrains with flexible platforms.
The McKinsey Consumer Pulse survey, which hails from our Center for Future Mobility, has some other important information for the industry trying to adapt to the new landscape. We have been polling consumers going back to 2016 to measure how attitudes are changing each year. This year’s survey included about 26,000 car owners around the world. What we’re seeing should give confidence to those who are rooting for more electrification.
First, there’s not a lot of backsliding among people who actually own BEVs. More than three-fourths of BEV owners say their next car will be battery-electric. Of the 24 percent who say they’ll switch, 5 of 8 say they’ll go with a plug-in hybrid, not gasoline. Only 1 percent say they’ll never go back to electric.
Second, while the growth of the overall EV market is slowing in the U.S., results vary widely by region. In California, Washington and Oregon – states where there have been major investments in infrastructure – EV adoption rates are on par with Europe. Other states on the East and West Coasts are seeing much more rapid EV adoption. For example, 19 percent of Maryland vehicle owners say their next car will be a BEV, even though the electric-vehicle market share is just north of 12 percent today.
By contrast, there are some states with a larger rural population mix where fewer than 4 percent of consumers say their next vehicle will run on batteries alone. This underscores the huge difference between urban, suburban, and rural consumers. Overall in U.S. urban areas, 51 percent say their next vehicle will be BEV or PHEV. In rural areas, it’s 18 percent.
A third differentiator is age. The younger the consumers, the more likely they will shift to electric soon. For Gen Z, 47 percent say they’ll buy a BEV or PHEV next. For Millennials, it’s 45 percent. It drops to 22 percent for Generation X and 21 percent for the Baby Boomers.
The most important finding may be the role that PHEVs are playing in the electric transition. Because of their smaller battery packs, they’re cheaper than BEVs. And since they run on gasoline when their EV-only miles are used up, there’s no range anxiety. But this taste of battery power acts like a gateway drug. Once they realize battery power can meet most of their needs, they keep going. Households that were holding onto a second, gasoline-powered car are ready to give it up for their next vehicle.
Another class of vehicle that may serve as a bridge is known as an extended-range EV, or EREV. These are similar to PHEVs, but instead of having an engine that can put the vehicle in motion, an EREV’s gas engine serves only as a generator to charge the battery pack. EREVs like the Ramcharger are coming to the U.S., with more electric-only range and total driving range than a typical PHEV. In China, where they’re more common, twice as many consumers say their next vehicle will be an EREV than say they’ll buy a conventional gas-powered vehicle.
The biggest determinant of EV sales over the long term will depend on the availability of much more affordable electric vehicles, the kind that are available in China today. For now, U.S. automakers will breathe a sigh of relief, gaining several years, and at least one product cycle more, to make EVs more profitable. They also know there is increasing risk of falling further behind Chinese OEMs who now sell more than 50 percent ‘new energy vehicles’ domestically and are building massive capacity for global EV exports with high tech content per vehicle at affordable prices.
What’s the bottom line? The full picture isn’t one of a stagnant U.S. market. It’s one of a market that is changing in significant ways. Key states and regions are already at the tipping point for EVs while others will continue to be slow to adopt. Important demographics like urban and young consumers are going electric. If PHEVs and EREVs become more common, that taste of electrification may accelerate changing attitudes and expectations.
Beyond the market slowdown and the removal of incentives, we can see signs of continued movement toward hybridization and electrification. It confirms what we have long known: consumers still have plenty of voice in the market’s actions.
Philipp Kampshoff is a senior partner and global co-leader of McKinsey’s Automotive & Assembly practice, based in Houston, and Patrick Hertzke is a partner and co-leader of McKinsey’s Center for Future Mobility, based in Boston.
Hyundai has been involved in hydrogen vehicle research and development for nearly three decades now, a nod to the company’s vision that hydrogen may well play an important part in our motoring future. That future seems more plausible given the vast deposits of extractible geologic ‘natural’ hydrogen recently discovered in the U.S. and around the world. The hydrogen NEXO fuel cell vehicle has been Hyundai’s most recent standard bearer in this realm since its debut in 2019.
The Korean automaker’s latest advancement is the debut of its second generation NEXO hydrogen fuel cell electric vehicle, a nameplate that debuted at the Consumer Electronics Show as a replacement to the Tucson FCEV back in 2019. The all-new 2026 NEXO improves on its predecessor in important ways, not the least of which is its ability to drive a projected 400 miles courtesy of an improved fuel cell, higher output motor drive system, larger hydrogen tank, and bigger battery.
Longer, taller, and wider than the model that came before it, the all-new NEXO features a more chiseled appearance and improved aerodynamics for efficiency. Exterior design cues include bold lines, horizontal groove patterns, an arch-shaped cross section, distinctive HTWO headlamps, and four “dot” lamps within the grille that distinguish NEXO as a hydrogen fuel cell model. An extensive suite of driver assistance and active safety systems is provided. Six color choices will be available including Ocean Indigo Matte, Ecotronic Gray Pearl, Creamy White Pearl, Amazon Gray Metallic, Goyo Copper Pearl, and Phantom Black Pearl.
NEXO is designed to be more than just a sustainably powered vehicle. Its interior is replete with sustainable materials including bio-process leather, bio plastics, recycled PET fabric, bio paint, bio PU slab foam, and recycled automotive plastic waste. The spacious cabin’s design theme aims to impart the comfort of home through features like soft padding with patterns while also reinforcing its high-tech nature with a curved information display, dashboard-integrated digital side mirror displays, and an island-type center console with a 120-volt AC outlet powered by the vehicle’s high voltage battery.
Greater overall performance is delivered with a new power electronics system that increases NEXO’s total power output from its previous 184 horsepower to a new 258 horsepower rating. Battery output has doubled to 80 kW while hydrogen stack output has increased 16 percent to 110 kW. All this delivers improved 0-62 mph (0-100 km) acceleration in just 7.8 seconds, a 1.4 second improvement from the previous generation NEXO.
While available to global markets later this year, in the States the hydrogen NEXO will be available only in California. Price will be released closer to the NEXO’s launch date.
The electric vehicle (EV) industry in the United States stands at a pivotal moment. What once seemed like a rapid and inevitable shift from internal combustion engine (ICE) vehicles to battery-powered alternatives has become a more complicated and uneven transition. A few years ago, automakers predicted EVs could account for 50 percent – or even 100 percent – of new-vehicle sales by the early 2030s. While we’re still bullish on the mass adoption of electrification, not just in personal transportation but also the energy storage systems and other industries, those initial forecasts face a reality shaped by economic, technological, political, and social hurdles.
Government policy has played a major role in the EV sector’s growth – and its recent turbulence. Subsidies, emissions targets, and infrastructure investments in recent years have spurred significant momentum. However, the new administration has re-evaluated EV tax credits while easing emissions standards and renewing support for fossil fuels.
Adding to the disruption are proposed 25 percent tariffs on vehicles, batteries, and components imported from Canada and Mexico, two crucial parts of the North American EV supply chain which has been optimized for more than 30 years. The potential for tariffs to upend established supply networks has led many manufacturers to delay or reconsider investments. This turbulence threatens not only EV growth but also the broader automotive sector, which depends on global sourcing and long-term planning.
While we are fully committed to U.S. battery cell manufacturing and onshoring as much of the supply chain as possible, there are still crucial elements of our supply chain that we source from abroad. Most artificial graphite is still processed in China – not because this is a difficult technology to master, but given that this is a low-tech, energy-intensive process that makes more sense to do in a country that has lower, government-subsidized energy costs.
It wouldn’t be impossible to onshore this process, but we’d first have to explore broader conversations as an industry and country about what elements of manufacturing are the most strategic, high-value, and worthy of bringing into our communities.
At the consumer level, EV adoption is proving slower and more complex than early forecasts suggested. High upfront costs, persistent range anxiety, inconsistent public charging infrastructure, and general consumer skepticism continue to act as barriers. Some industry analysts describe the slowdown as a natural, temporary “ebb,” common in technological transitions. Still, without major shifts in technology, infrastructure, and policy, achieving earlier market share projections looks increasingly unrealistic.
Until we help enable more affordable EV choices for customers, the industry will have to adjust to expectations and strategies to match the market’s more gradual pace.
Amid the instability, LG Energy Solution continues to be a key player. We’ve invested heavily across North America, with eight battery plants either completed or underway, including joint ventures with major global automakers such as General Motors, Honda, Hyundai, and Stellantis. We also have three wholly-owned cell-makings plants in Holland and Lansing, Michigan, along with Queen Creek, Arizona.
Despite our presence in the industry, we still face the same headwinds as the broader market: rising material costs, supply chain disruptions, and uncertain demand. Building massive battery capacity is a bet on sustained EV growth – a bet that, while logical in the long run, carries substantial short- and medium-term risks.
Mass EV adoption will require more than a steady battery supply and affordable vehicle choices that meet customers’ range requirements. Critical technological and infrastructure challenges must be solved. Industry studies point to several areas for development, including:
We, like other industry leaders, continue to invest in R&D to improve battery chemistry and formulas that balance cost and energy density. We’re also interested in helping expand charging infrastructure, where compatibility and reliability issues remain hurdles for EV drivers.
However, scaling public charging infrastructure, especially in rural and underserved areas, requires significant investment that private companies alone cannot deliver. Federal, state, and local governments play essential roles in filling these infrastructure gaps.
Affordability remains another major barrier to EV adoption. Although the price gap has narrowed – ICE vehicles averaged about $48,000 in 2024 compared with $56,000 for EVs – the difference remains significant for many consumers. Federal tax credits and automaker discounts have helped, but with incentives under political scrutiny, affordability concerns could deepen.
Part of this is on us as an industry to give customers a good reason to embrace EVs. Faster, cheaper, better products always win in the marketplace. We’ve achieved two of these elements with EVs, and you could realistically argue that China, with its more mature and developed EV market, is already there. I believe that as we make EVs more affordable – think $30,000/300-mile range vehicles – mass adoption will inevitably follow.
Tariffs add further pressure. If imposed broadly, tariffs on critical minerals, battery components, and finished vehicles could raise costs at a time when lower prices are essential to broader EV adoption. While automakers and suppliers develop contingency plans to manage supply disruptions, there is no substitute for a stable, cooperative trade environment when it comes to building a resilient EV ecosystem.
Despite current challenges, the long-term outlook for EVs remains strong. Governments globally continue pushing for cleaner transportation, consumers are becoming more comfortable with EVs, and technological advancements are steadily improving battery performance and reducing costs.
Still, the path forward will likely be slower and more uneven than early projections suggested. In fact, some smaller or less diversified players may struggle or exit the market. Industry consolidation among battery makers, automakers, and suppliers seems increasingly likely.
As the battery cell and related industries consolidate in the next few years, LG Energy Solution is in an advantageous position as an established company with mature technology, a high and consistent production yield rate, and more than 70,000 battery-related patents across the spectrum of different chemistries, form factors, and other technology. We plan to ride out the current storm, and we’re actually seeing more interest from potential OEM partners who appreciate that we’re a safe long-term bet.
LG Energy Solution’s investments position it to navigate volatility and competition. However, success will depend not just on existing scale but on continuous innovation, cost control, partnerships, and political flexibility.
Beyond battery production, LG Energy Solution is exploring broader opportunities in the future of urban mobility. In Detroit, for example, the company has supported early discussions about creating EV-exclusive zones that could serve as test beds for new urban transportation models. While these ideas are still in development, they illustrate the increasingly complex ecosystem that EV suppliers must engage with – one that includes cities, utilities, tech firms, and real estate developers.
Still, real transformation will require broad collaboration. Transforming urban areas into EV-friendly environments demands regulatory changes, infrastructure investments, consumer education, and cross-sector coordination on an unprecedented scale.
When it comes to capital-intensive industries like batteries and complex technology that offers long-term but perhaps not immediate payoffs, some government support is helpful to spur adoption and seed investment and growth. Make no mistake, we do not believe that subsidies like the 30D and 45X credits from the IRA are a long-term solution, but they have both played an essential role in getting this vital, strategic industry established in the U.S.
It’s also important to note that LG Energy Solution was investing in U.S. battery production long before the advent of the IRA, and we will continue to do so, even in a changing political environment as we believe in the long-term prospects of the technology in this market.
The EV transition is not a straight path; It is a complex evolution filled with fits and starts, shaped by shifting political winds, economic uncertainties, and technological hurdles. We are helping to drive this transformation, but the industry’s success will depend on efforts far beyond those of any single company.
With careful planning, public-private cooperation and a willingness to adapt to changing realities, the vision of a sustainable, electrified future remains within reach. The question is not whether the transition will happen – but how quickly, how smoothly, and who will still be standing when it does.
Robert Lee is President of LG Energy Solution North America.
The electric vehicle (EV) industry is no longer emerging – it’s a global race. You don’t need headlines to see the electric revolution underway; you just need to look around. From quiet electric lawnmowers to battery-powered tools and sleek EVs in driveways, electrification is here, and it’s being driven by real consumer choice – not just regulations.
Electric technologies are more efficient, quieter, and cleaner. But full-scale electrification still faces major hurdles, especially in how we power EVs and manage that power once it’s onboard. At the heart of this transformation is the challenge of managing energy on both sides of the plug: from the grid to the vehicle, and from the battery to the wheels.
This is where Eaton excels. With over a century of experience managing electrical and mechanical power, Eaton brings a unique, system-level perspective to electrification, delivering smarter solutions for both infrastructuring and vehicle architecture.
Before an EV can drive a mile, its power must travel through a complex web of electrical infrastructure. The real bottleneck to deploying EV charging at homes, businesses, and public sites isn’t hardware, it’s ensuring the grid can handle the added load.
Eaton’s Electrical Sector has long powered critical infrastructure like hospitals and data centers. Today, that same expertise is helping to scale EV charging networks. From circuit breakers and switchgear to UPS systems and advanced metering, Eaton’s portfolio ensures that power can be delivered safely, reliably, and efficiently.
To simplify deployment, Eaton partnered with ChargePoint, combining chargers, power distribution gear, and engineering services into a single solution. This streamlines electrification for businesses and municipalities.
Looking ahead, Eaton and ChargePoint are also developing bidirectional charging and vehicle-to-everything (V2X) capabilities. These technologies will allow EVs to feed power back to homes or the grid, turning vehicles into mobile energy assets.
Managing energy doesn’t stop at the charging cable. Inside the vehicle, power must be used wisely to maximize range, performance, and safety. Eaton’s Mobility Group brings decades of experience in vehicle power electronics, safety systems, and drivetrains to meet this challenge.
One example is Eaton’s Battery Disconnect Unit with Breaktor protection, which integrates the functions of fuses, contactors, and pyro switches into a single, compact device. This innovation enhances safety by enabling ultra-fast fault isolation while reducing the number of components – making electric vehicles lighter, more efficient, and more reliable.
Another innovation is the Battery Configuration Switch (BCS), developed with Munich Electrification. It allows EVs to seamlessly switch between 400-volt and 800-volt charging systems without compromising performance, improving both compatibility and reliability.
One of the most overlooked challenges in EV design – especially for commercial vehicles – is drivetrain performance. Traditional direct-drive EV systems struggle with acceleration, high-speed efficiency, and gradeability, especially when carrying heavy loads.
Eaton solves this with a portfolio of EV transmissions purpose-built to improve torque, efficiency, and flexibility across light-, medium-, and heavy-duty commercial vehicle platforms.
Its heavy-duty 4-speed EV transmission, recognized as a 2024 Automotive News PACEpilot Innovation to Watch, delivers smooth launches on 30 percent grades and maintains highway speeds on inclines as steep as 7 percent. The transmission leverages a proven layshaft architecture – common in automated manual transmissions (AMTs) – but reengineered for EVs. Without a clutch, gear shifts are synchronized by the traction motor, resulting in greater efficiency and seamless performance.
Medium-duty EVs benefit from 4- and 6-speed variants that have logged over 2 billion real-world miles. Their lightweight countershaft design and electric gear actuation allow for smaller, more efficient motors – reducing battery size and improving range.
Also, part of the lineup is Eaton’s ultra-compact 4-speed transmission, which delivers exceptional torque density, more payload capacity, extended range, and added space for battery packaging. This design makes it easier for OEMs to tailor powertrains to their specific duty cycles.
Together, these EV transmissions help overcome the limitations of direct-drive systems, providing diesel-like performance while improving acceleration, climbing ability, and highway cruising efficiency. This matters in real-world applications where every percent of efficiency and every pound of payload makes a difference.
In EVs, even the smallest components can have an outsized impact on performance. Eaton continues to lead in terminals and connectors that maximize conductivity and minimize heat loss. Products like high-power lock box terminals and RigiFlex busbars ensure efficient power flow to critical subsystems – from infotainment and climate control to traction motors and braking.
These components support flexible vehicle architectures, enabling OEMs to customize designs while maintaining safety and performance.
Reliability is critical, especially in crash scenarios. Eaton’s dual-trigger pyro fuses act like airbags for the electrical system, disconnecting power instantly in the event of a crash. Combined with Breaktor technology and Bussmann EV fuses, Eaton offers a full spectrum of circuit protection tailored to evolving EV requirements.
These systems help EVs meet the toughest safety standards without adding unnecessary weight or complexity – an essential balance for today’s high-performance electric vehicles.
What sets Eaton apart isn’t just one standout product, it’s the company’s ability to manage power from the transformer to the transmission. The Electrical Sector ensures grid readiness and smart infrastructure. The Mobility Group ensures vehicles are equipped to use that power safely and efficiently.
Few companies have the breadth and depth to support the entire EV power journey. Fewer still have done so with the legacy of safety, innovation, and sustainability that Eaton brings to every product it builds.
Electrification is no longer a dream – it’s happening. But to reach its full potential, the industry needs partners who understand how to connect every dot in the power ecosystem. Eaton manages both sides of the plug, and that may be exactly what the EV industry needs to bridge the gap between promise and progress.
Mike Froehlich is Global Vice President of Engineering-eMobility at Eaton., an intelligent power management company that makes products for the mobility, utility, industrial, aerospace, and other markets.
Electric vehicles reached a new record market share in 2024, so it seems the enthusiasm for electrification won’t be powering down anytime soon. Adoption of electric vans and trucks continues to grow on the commercial side, including among large cities, small towns, and businesses of all sizes. That’s what we’re seeing every day at Ford Pro, the commercial vehicles division of Ford Motor Company.
Based on conversations with real-world Ford Pro customers, we’ve gleaned three trends for 2025 on electric vehicles in business and government fleets that are worth considering.
Early adopters are entering their next phase: Many companies that were early adopters of electric vehicles in pilot programs are now expanding their fleets. That’s likely to continue in 2025, having found that electrification made good business sense for them.
Elite Home Care, a South Carolina-based senior and disability care provider, started their electrification journey with a single Ford E-Transit electric van in 2022. Today, they have 27 E-Transit vans upfitted with lifts providing over 10,000 trips per month for their patients while saving $6,500 per van each year.
Chris Russo, co-founder of Elite Home Care, shared with us what these savings have meant for his business: “E-Transits have allowed us to expand our business because we save so much money. Now we can expand our reach to more people needing care. Moving to E-Transit vans has lowered our fixed costs. It’s allowed us to do more of the things we’d like to do to give back.”
Business and government customers are increasingly learning from their connected vehicles and relying on those learnings to make informed business decisions. These insights include realizing fuel and cost savings, tracking efficiency, staying ahead of the curve on maintenance, and even knowing when to replace vehicles.
DHL Express, a global delivery and logistics company, uses Ford Pro E-Telematics to see how much gas and carbon dioxide emissions they’re saving by switching to electric vehicles.
Chris Wessel, director of U.S. Fleet for DHL Express, told us how important that data is for a sustainable company with a stated goal of 60 percent of its last-mile delivery fleet being zero-emission by 2030: “In conjunction with other tools, we’re using Ford Pro E-Telematics to look at the fuel savings of our fleet, and then we’ll tie that back to our carbon reporting, making sure that we have a holistic view of our fleet and greenhouse gases avoided.”
Data is also helping customers decide when – or if – to electrify their fleet. Ford Pro E-Switch Assist, our free online tool that uses vehicle telematics data to determine fleet suitability for electric trucks and vans, has already assessed more than 38,000 vehicles.
If you’re reading this, chances are good there’s an electric vehicle charger installed outside your office, warehouse, or other place of business. But commercial electric vehicle charging is increasingly moving beyond the vehicle depot or company parking lot and into employees’ homes and other locations – and not just in warmer locales like California or Texas, but across a wide range of climates, terrains, and geographies.
With nearly a third of fleet managers reporting company vehicles being taken home at night, that trend will likely grow throughout 2025.
Fize Électrique, an electrical contractor in Canada, has installed six Level 2 chargers at its office. But their employees who take their company electric vehicles home at the end of the workday also have chargers installed at their homes.
Alain Fiset, director of smart energy for Fize Électrique, explained why they’ve split their charging between depots and employee homes: “Having a charging station for each EV is necessary for a smooth experience. The key to success with an electric vehicle is to charge it every night on a Level 2 charger.”
Behind these trends is an important fact: having the right team behind you makes adopting electric trucks and vans easier. That’s why Ford Pro offers an end-to-end solution of vehicles, charging, software, service, and financing to help streamline the process and maximize uptime for small, medium, and large business and government fleets. Just ask BellaVista Landscaping in San Jose, California, which has used the full spectrum of Ford Pro solutions in adding 25 hybrid and electric vehicles to its fleet since 2023.
As we enter 2025, look for companies to charge ahead with electric trucks and vans, the chargers and software that power them, and the service solutions that keep them on the road.
Trevor Blum is Senior Manager, Commercial Electric Vehicles at Ford Pro
Manufactured in Tennessee on Volkswagen’s MEB modular world electric car platform, the 2021 VW ID.4 presents a new and compelling all-electric SUV that enters a segment presently dominated by Tesla, Chevrolet, and a select few others. What ID.4 brings to the battery electric SUV segment that Tesla doesn’t is price, coming in at a base cost of $39,995, some $10,000 less than Tesla’s Model Y.
For this, electric vehicle buyers get SUV hatchback utility, three-foot legroom in all seating positions, and ample luggage capacity for 5 adults. VW estimates ID.4 driving range at 250 mile on a full charge, and additionally points out that an additional 60 miles of range is attainable in just 10 minutes from a public DC quick-charge station.
Sporting a stature similar to that of Honda’s CR-V, the Volkswagen ID.4 rides on a steel-framed architecture featuring strut-like front suspension and multi-link suspension with coil-over shocks at the rear. This, combined with a long wheelbase and short overhangs, promises a smooth ride dynamic. Braking is handled by front disk and rear drum brakes.
A single permanent magnet, synchronous electric motor directs power to the rear wheels. The ID.4 produces 201 horsepower and 228 lb-ft torque that’s expected to deliver a 60 mph sprint in about 8 seconds. Electricity to power the motor is provided by an air-cooled, frame-integrated 82 KWh lithium-ion modular cell battery. An onboard 11KW charger enables three charge modes via standard 110-volt household power, 220-volt Level 2 charging, or DC fast charging. Typical charging with a home wall charger or public Level 2 charger will bring a full charge in 6 to 7 hours.
A minimalistic yet futuresque cabin with segment leading cabin volume rounds out ID.4’s architecture. Features include a driver-centric, touch sensitive steering wheel and a view-forward 5.3-inch ID information center that replaces conventional gauges. Vehicle operation is through steering wheel-mounted switches, with infotainment, climate control, device connectivity, navigation, and travel information accessed through a 10.3 inch touchscreen monitor. A 12 inch monitor is available with the model’s Statement Package.
Topping the list of features is expanded voice command and a communicative dash-integrated ID light bar. ‘Intuitive Start’ driver key fob recognition enables pre-start cabin conditioning capability. Base model upholstery is ballistic cloth with leatherette seat surfaces optional.
Volkswagen’s IQ Drive driver assist and active safety suite features travel assist, lane assist, adaptive cruise control, front and rear sensors, emergency assist, blinds spot monitoring, rear traffic watch and more. All this comes standard along with Pro Navigation, a heated steering wheel and front seats, wireless phone charging, and app connectivity for compatible devices.
The ID.4 EV is available in six colors and two trim levels, Gradient and Statement, for personalization. The optional Gradient package features a black roof, silver roof trim, silver accents, and silver roof rails along with 20-inch wheels to complete the upscale look. Looking forward, while rear-wheel drive is the choice today, Volkswagen is already talking up an all-wheel drive variant for early 2021 along with a lower-priced base model.
As the world’s largest automotive group, Volkswagen has the capacity to change the ever-expanding electric-car landscape. Looking at the style and utility of VW’s all-new ID.4, you can sense the renewed “people’s car” direction of the brand that accompanies the automaker’s commitment to electrification. VW says it’s aiming at selling 20 million electric cars based on the MEB electric car platform by model year 2029. Certainly, the potential for selling in truly significant numbers is reinforced by ID.4 pre-orders selling-out in just weeks, it’s safe to say.