Polestar blocked from future U.S. car sales

On June 25, 2026, the U.S. Department of Commerce’s Bureau of Industry and Security declined to grant Polestar a specific authorization under the Connected Vehicle Rule. The decision means Polestar will be unable to market or sell new vehicles in the United States starting with the 2027 model year.

The Connected Vehicle Rule targets connected vehicle manufacturers that are owned by, controlled by or subject to the jurisdiction or direction of China or Russia, and vehicles using their covered software. It is framed as a national security measure focused on data access and remote connectivity risks.

Polestar is majority owned by Geely, a China-based automotive group. None of the Polestar vehicles currently sold in the U.S. are built in China; the Polestar 3 is produced at a plant in Charleston, South Carolina, and the Polestar 4 in South Korea.

The Connected Vehicle Rule introduces software-related restrictions that take effect beginning with the 2027 model year. These limits apply to vehicles using certain connected-vehicle technologies linked to countries of concern, including China and Russia.

Hardware-related restrictions are set to phase in starting with the 2030 model year. Automakers that may fall under the rule’s scope must seek case-by-case authorizations to continue importing and selling connected vehicles in the U.S. market.

Volvo Cars, which is also majority-owned by Geely, pursued such an authorization and received approval to keep selling connected vehicles in the United States. Polestar did not obtain a similar authorization, resulting in its removal from future U.S. new-vehicle sales.

Polestar stated it will continue to sell existing U.S. inventory of the Polestar 3 and Polestar 4. These vehicles can still be sold because the restriction applies from the 2027 model year onward, and current stocks relate to earlier model years.

The company has emphasized that it will continue to support existing U.S. customers. This includes maintaining access to its service network to handle maintenance, repairs and other aftersales needs.

Reports indicate that Polestar’s U.S. dealer network, reported as 32 dealers, will remain open primarily to provide service and to sell remaining inventory. As 2027 approaches, these outlets are expected to wind down new-car sales activity under the Polestar brand.

Polestar has said it will increase its strategic focus on Europe as U.S. restrictions take effect. Europe already represents roughly 80% of the company’s retail sales volumes.

The company noted that 94% of its retail sales in the first quarter of 2026 originated from markets outside the United States. This sales mix provides a base for concentrating future growth in regions not directly affected by the Connected Vehicle Rule.

Polestar’s redirection of resources to Europe follows the effective end of its plans to launch additional new models in the U.S. under the current regulatory framework. The company intends to build on its existing presence in European markets to offset the loss of future U.S. sales.