Polestar to Stop Selling New Cars in U.S.

Polestar will stop selling new vehicles in the United States beginning with the 2027 model year after the U.S. government denied the company authorization under federal connected-car rules.

The decision, first detailed by Reuters, affects the Sweden-based electric-vehicle maker because it is majority-owned by China’s Geely Holding. It follows the U.S. Commerce Department’s Connected Vehicles Rule, which restricts the import or sale of certain connected vehicles and related technology linked to China or Russia.

The rule applies to passenger vehicles and covers technology used for external vehicle communications, including software and hardware linked to Bluetooth, Wi-Fi, cellular and some satellite systems. U.S. officials say the restrictions are intended to address national security risks involving data collection and possible remote access to vehicles.

Polestar said it will continue selling existing Polestar 3 and Polestar 4 inventory in the United States. The company’s U.S. dealers will remain open for service, customer support and warranty work.

The company said it does not plan to appeal the decision.

The U.S. has been a smaller market for Polestar than Europe. In the first quarter, 6 percent of Polestar’s sales came from the United States, compared with 78 percent from Europe.

Polestar CEO Michael Lohscheller said Europe remains the company’s largest growth engine and said the automaker plans to manufacture the Polestar 7 in Europe.

The decision leaves Polestar’s longer-term U.S. presence uncertain, including the future of the Polestar 3, which has been produced at Volvo’s plant in South Carolina.