Polestar (Nasdaq: PSNY) is expanding its contract manufacturing footprint to Europe through a new memorandum of understanding with Volvo Cars. The two companies plan to manufacture the upcoming Polestar 7, a premium compact SUV set to launch in 2028, at Volvo’s new factory in Kosice, Slovakia.

The Polestar 7 will be developed using Geely Holding Group’s shared vehicle architectures, incorporating Volvo’s technology base. It will feature cell-to-body battery technology, next-gen e-motors, and other performance enhancements tailored to Polestar’s brand identity.

Polestar CEO Michael Lohscheller emphasized that the collaboration strengthens the company’s European presence and supports cost-efficient access to cutting-edge tech. Volvo Cars CEO Håkan Samuelsson highlighted the strategic synergy between the two brands.

The Kosice factory, under construction since 2023, benefits from strong logistics and supplier infrastructure, positioning it well to serve the European market.