The U.S. Strongarms Polestar Out Of The American EV Market

The Swedish automaker, owned by the Chinese parent Geely, will not be allowed to sell EVs in the U.S. model year 2027 onward.

Photo by: Mack Hogan/InsideEVs

By: Suvrat Kothari

Jun 25, at 9:40am ET

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Polestar will no longer be able to sell new vehicles in the U.S. starting with model year 2027, after the U.S. Department of Commerce denied the company an authorization under the Connected Vehicle Rule.

The Swedish automaker said it will continue to sell the remaining U.S. inventory of the Polestar 3 SUVs and Polestar 4 crossovers, and continue supporting existing customers through its service network. But no new model year 2027 EVs will come to America.

“We will continue to sell current stock, just as today,” a Polestar spokesperson told InsideEVs in an email. “Moving forward, customers will enjoy the same access to service stations and customer service, but from MY 2027 onwards, we will stop marketing and sales of our cars in the U.S.”

Gallery: Polestar 3 First Drive: Jackson, Wyoming

Source: InsideEVs

The Connected Vehicle Rule, which restricts vehicles with software and hardware linked to foreign entities of concern—such as China—has become a major barrier for automakers with Chinese manufacturing ties.

Polestar is owned by Chinese auto giant Geely, which is also the parent company of Volvo. However, the Polestar 3 is assembled in the U.S. at Volvo Cars’ factory in Charleston, South Carolina, whereas the Polestar 4 is made in Busan, South Korea, at a Renault-owned facility. Volvo was recently granted authorization to sell connected vehicles in the U.S.

The automaker, however, is framing the exit as a strategic pivot rather than a retreat. The company says Europe already accounts for close to 80% of its retail sales, and that figure climbed to 94% in the first quarter of this year, factoring in markets outside the U.S. as well.

“The automotive industry is entering a new phase, based on regional dynamics,” Polestar CEO Michael Lohscheller said in a statement. “Our strategy reflects that, with Europe being our largest growth engine, and our plan to manufacture Polestar 7 in Europe. We will continue to invest in markets where we have opportunities to continue to grow, like Southeast Asia, Eastern Europe, Latin America, and Canada.”

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Contact the author: suvrat.kothari@insideevs.com