Volvo spin-off reveals Tesla Model 3 competitor

The base price for Polestar 2 will be around 40,000 euros, equivalent to about $ 45,000. It's about the starting price of a Tesla Model 3 today. Still, like Tesla, Polestar will produce more expensive versions of its car first. The launch edition of Polestar 2, which will be made during the first 12 months of production, will cost around 60,000 euros, equivalent to about $ 68,000.

Production will begin in early 2020 in China, the home of Geely Holding Group, Volvo's parent company and Polestar's co-owner.

All four-wheel drive cars with four doors have two electric motors with an expected driving range of 500 kilometers on a full battery based on European and Chinese standard driving tests or 275 miles based on US EPA driving tests. The company promises zero to 60 acceleration in under five seconds. An optional performance package will provide the car's performance-adjusted shock absorbers, brakes and tires for better handling.

Like Tesla's cars, Polestar has "vegan" interior materials, rather than leather. Drivers will be able to use their smart phones as an external key fob, another feature found on Tesla cars. An optional pilot package will provide automated driving assistance features, such as Lane Keeping Assistance – which holds the car in its path – and the ability to park itself without a car in the car, a Polestar spokesman said.

While the car is available for purchase, the company will heavily market a subscription plan from which drivers pay a monthly fee that includes insurance costs as well as the cost of the car even in a single monthly payment. The prices for the subscription service have not been settled, a Polish spokesman said. The cars will also be available for sale, but for customers who want to buy one only. Polestar 2 will only be sold online via Polestar.com.

Polestar 1, the brand's first car, is a high-performance plug-in hybrid that is produced in limited numbers. Polestar 3, which has not yet been revealed, will be a fully electric SUV, the company said.

Polestar was originally the name of a Swedish company, Polestar Performance, which created racing versions of Volvo cars. Volvo acquired this company in 2015 and added the name to performance-adjusted versions of its own cars. The Polestar name will still be used on hybrid and electric performance-adjusted Volvo cars as well as being its own car brand.