U.S. connected-vehicle rules block future Polestar models from market

Polestar Automotive Holding UK has been denied authorization to sell future model-year 2027 vehicles in the U.S. under new connected-vehicle regulations targeting Chinese technology, the Swedish EV maker confirmed. The rules, introduced by the Biden administration, restrict connected vehicles with Chinese software, hardware, or ownership ties on national security grounds. Polestar, which is backed by Zhejiang Geely Holding Group, will continue selling existing inventory of its Polestar 3 and Polestar 4 electric vehicles and servicing current customers in the U.S. The company also plans to accelerate its shift toward Europe while preparing regional production for future models. Polestar’s American depositary receipts fell about 6% on June 25 following the announcement. Bloomberg Intelligence analysts estimate that the U.S. sales ban could put approximately $250 million in 2027 revenue at risk, representing roughly 5% of the group’s total sales. Europe accounts for nearly 80% of Polestar’s current sales, with 94% of first-quarter deliveries coming from markets outside the U.S. Analysts suggest that a Europe-focused strategy could help Polestar avoid EU tariffs on China-made EVs by redirecting South Korea-built Polestar 4 vehicles from the U.S. to Europe. Polestar 3s for the U.S. market are assembled at Volvo’s plant in Charleston, South Carolina. A Volvo spokesperson stated that it was too early to assess any potential impact and that previously announced investments at the Charleston facility remain unchanged. Polestar CEO Michael Lohscheller emphasized the company’s commitment to markets where growth opportunities exist, while Geely Holding reaffirmed its support for Polestar’s management team in navigating market access challenges. The U.S. policy follows broader efforts to limit Chinese influence in connected vehicle technology, including a 100% import tariff on Chinese-made EVs.