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 automaker said in a press release on Thursday.
The Swedish automaker will continue to sell the remaining U.S. inventory of the Polestar 3 SUVs and Polestar 4 crossovers, and support 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.”
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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.”
The automaker had ambitious growth plans in the U.S. and overseas markets. Polestar posted its best ever first quarter sales globally this year, thanks to growth in Europe, Australia, and South Korea. The next-generation Polestar 2 crossover is in the pipeline, and so is the Tesla Model Y-rivaling Polestar 7. The automaker also recently upgraded the Polestar 3 with an 800-volt architecture, vastly improved fast-charging speeds, and a more powerful Nvidia Drive AGX Orin computer.
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